• 3 minutes Don't sneeze. Coronavirus is a threat to oil markets and global economies
  • 5 minutes Boris Johnson taken decision about 5G Huawei ban by delay (fait accompli method)
  • 9 minutes This Battery Uses Up CO2 to Create Energy
  • 12 minutes Shale Oil Fiasco
  • 8 hours Historian Slams Greta. I Don't See Her in Beijing or Delhi.
  • 1 day We're freezing! Isn't it great? The carbon tax must be working!
  • 1 day US (provocations and tech containment) and Chinese ( restraint and long game) strategies in hegemony conflict
  • 4 hours Trump has changed into a World Leader
  • 5 hours Beijing Must Face Reality That Taiwan is Independent
  • 2 hours Let’s take a Historical walk around the Rig
  • 2 days Indonesia Stands Up to China. Will Japan Help?
  • 5 hours Tesla Will ‘Disappear’ Or ‘Lose 80%’ Of Its Value
  • 4 hours Yesterday POLEXIT started (Poles do not want to leave EU, but Poland made the decisive step towards becoming dictatorship, in breach of accession treaty)
  • 2 days Might be Time for NG Producers to Find New Career
  • 2 days Environmentalists demand oil and gas companies *IN THE USA AND CANADA* reduce emissions to address climate change
  • 3 days Anti-Macron Protesters Cut Power Lines, Oil Refineries Already Joined Transport Workers as France Anti-Macron Strikes Hit France Hard
Charles Kennedy

Charles Kennedy

Charles is a writer for Oilprice.com

More Info

Premium Content

Shell Produces Gas at Record Low Cost in China

Royal Dutch Shell has announced it is producing natural gas at its Changbei project in China at a major discount and plans to start test production in the second phase by late next year or early 2015.

In partnership with PetroChina, Shell is producing natural gas from the Changbei field at $1 per barrel, or 91% lower than PetroChina’s lifting cost of $11.74 per barrel as of 2012 in similar projects.

Shell, taking advantage of China’s unconventional gas sector, is investing a total of $1 billion in China this year, and the Changbei project’s cheap production is helping to offset investment costs. Shell has also said it would continue to invest the same amount annually in China.  

Related article: Russia Takes Steps to Increase LNG Exports

Changbei is the largest onshore venture between a Chinese entity and an international company. The first phase of the Changbei joint venture in northern China’s Shaanxi province came online in 2007 and is set to churn out 3.3 billion cubic meters of natural gas annually at its peak. As of January 2012, the field had produced 18.33bcm in total. Reserves are estimated at 96.1bcm of natural gas.

Xu Li, Shell’s general manager of the field said that Shell will drill more wells at different depths in the second phase. Test production from the second phase could start in late 2014 or early 2015 based on test results and government approvals.

“We have started to drill more test wells in the second phase of development in the Changbei project, and we expect the second phase to bring a significant amount of output,” in addition to the first phase, Xu Li, Shell’s general manager of the field, said.

Shell and PetroChina are looking expand their operations in the field, as China moves to reduce its energy dependence from coal to cleaner sources like natural gas. At present, two-thirds of China's electricity is generated by coal-fired power plants, which emit greenhouse gases that lead to pollution.

By. Charles Kennedy of Oilprice.com




Download The Free Oilprice App Today

Back to homepage




Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play