Sinopec finds new shale-oil reserve in Southwest China

Sinopec, China's state owned oil company, announced on Thursday that it had discovered a new reserve of shale in the southwest Sichuan Basin.

Sinopec Exploration Company said that the exploratory well Qiluye 1 drilled in Chongqing's Qijiang district found a shale reserve in the Sichuan Basin with an estimated resource of more than 100 million metric tonnes, or approximately 730 million barrels.

According to a press release from the company, the estimate was based on the fact that the well had produced daily flows of 38.64 cu m of oil and 10000 cubic m of natural gas while testing.

The company stated that it had previously discovered the Qijiang Shale Gas Field in 2022, and then expanded its exploration into shale Oil resources in the region.

The company stated that the latest discovery expands Qijiang's unconventional resource potential by forming an "oil-below-gas" layered structure in conjunction with the existing shale-gas field.

Sinopec also identified three additional shale formations, and will produce about 705,000 tonnes of shale crude oil by 2024. This will contribute to China's annual output of shale crude oil of over 6 million tons. (Reporting and editing by Christian Schmollinger; Sam Li, Lewis Jackson)

(source: Reuters)