Sinopec has made significant shale gas discoveries in the Nanchuan Block in Chongqing Municipality, part of southwestern China’s Sichuan Basin.
Sinopec has completed four wells, with each well flowing at more than 200,000 cubic metres per day during testing, according to the Chongqing Development and Reform Committee. Sinopec Huadong Oil and Gas, which is located in Jiangsu Province, drilled the wells.
The highest production rate was recorded at the 197-4 HF well, which flowed at 410,000 cubic metres per day.
Nanchuan is part of the larger Fuling field, which is owned and operated by Sinopec. Sinopec plans to spend 1.7 billion yuan (US$250 million) this year on building eight drilling pads and sinking 33 production wells at Nanchuan. The company hopes to set up 650 mcm of shale gas production capacity at the field.
In 2011, the Ministry of Land and Resources (MLR) issued Sinopec with an exploration licence for Nanchuan, which covers 1,603 square km and is estimated to have 526.2 bcm of in-place shale gas.
Local authorities and Sinopec want to establish 2.4 bcm of production capacity at Nanchuan during the current Five-Year Plan (FYP, 2016-20).
Sinopec is poised to increase its production capacity at Fuling, China’s largest shale gas field, by 3 bcm to 10 bcm this year. In 2016, the company added 1.73 bcm of new capacity. Despite the increase, output only reached 5 bcm, with 44 wells drilled and 43 completed. The field is now operating 232 production wells.