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Changbei gas field starts

By Fu Chenghao (Shanghai Daily)
Updated: 2007-03-02 14:36

PetroChina Co and Royal Dutch Shell Plc said yesterday they have started commercial production and delivery of gas from Changbei gas field in northern China.

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The two firms are jointly developing the field under a production sharing contract, with Shell the field development operator, according to a joint statement.

The field, located on the edge of the Maowusu Desert in the Ordos Basin inShaanxiProvince andInner MongoliaAutonomous Region, represents the largest onshore upstream cooperative development that Shell has in China.

The two companies will deliver the natural gas toBeijing,Tianjinas well asShandongandHebeiprovinces.

Production is set to rise to the planned plateau rate of three billion cubic meters a year during 2008, the statement said.

Shell has been extending its reach in China's energy and petrochemical markets, aiming to become an integrated player in the fast-growing market.

"We are not only interested in cooperating with Chinese companies in domestic opportunities (but) we also like to join hands with Chinese peers for overseas opportunities," Lim Haw Kuang, executive chairman of Shell China, said in an earlier interview.

Last year, it acquired Beijing Tongyi Petroleum Chemical Co and Koch Materials China (Hong Kong) in separate deals to bolster its share in China's lubricant and bitumen markets.

More significantly, Shell is also studying multibillion-dollar coal-to-liquid fuel projects with Chinese partners.

Lim said Shell is also keen in oil and exploration blocks offered by PetroChina to foreign participation in northwesternXinjiangUygur Autonomous Region.