China National Petroleum (CNPC) has unveiled plans to invest more than CNY150bn ($22bn) by 2020 in oil and gas operations in the western region of Xinjiang.
The investment will enable the company to increase production in the region to more than 50 million tonnes (Mt) of oil equivalent by 2020 in an effort to replace output from ageing fields in northeast China, Reuters reported.
The proposed spending is equivalent to the total costs incurred by CNPC’s division PetroChina for oil and gas exploration and production last year.
CNPC’s operations in Xinjiang produced 11.45Mt of crude oil last year.
Citing PetroChina’s 2017 annual report, the news agency stated that the company produced 23.5 billion cubic metres of gas from the region’s Tarim gas basin.
China is taking initiatives to reduce its dependence on coal and shift to other sources, including natural gas.
The investment will also replace production from the Daqing oilfield in northeastern province of Heilongjiang.
CNPC intends to develop Xinjiang into the largest refining and chemical processing base in northwestern China, as well as the largest oil and gas import channel in the country, Asia Times cited a report by The Paper.
Under an agreement with the local government, the company has agreed to promote the development of oil and gas exploration, oil refining and the regional chemical industry.
The company will also support the sales, storage and transportation of oil and gas.
