Sinopec uncovers high-yielding shale gas reserve in Sichuan Basin

China Petroleum & Chemical Corporation's has announced that the first phase of the Qijiang shale gas field has uncovered a major discovery in Sichuan Basin with a proven geological reserve of 145.968 billion cubic meters, said the company.

The discovery, delivered by Sinopec Exploration Company and Sinopec Southwest Oil & Gas Company, is a major breakthrough in Sinopec's "Project Deep Earth – Natural Gas Base in Sichuan and Chongqing."

The Qijiang shale gas field is the first shale gas field discovered in medium-deep and deep strata in a complex tectonic zone on the margin of the basin. Shale gas buried at the depth of over 3,500 meters is defined as deep shale, and the burial depth of Qijiang's shale formations ranges from 1,900 to 4,500 meters, with the majority being deep shale. With complex overlying strata, the project faced great challenges such as a significantly greater depth and variable ground stress.

To tackle the question of how a shale gas reservoir was formed in the basin margin with such complex surface and underground conditions, Sinopec's team conducted more than 10,000 lab analysis tests on the core at the depth of 1,320 meters. This revealed the development and maintenance mechanism of deep shelf shale pores and identified the deep shale can develop vast reservoirs with high porosity, and also revealed the "sweet spots" of projecting the deep shale targets.

The team collected high-precision 3D seismic data of deep shale gas covering an area of 3,662 square kilometers in the complex zone of the southeastern margin of the Sichuan Basin as well as drilling data of existing wells in southern Sichuan. After repeated discussion and screening, Sinopec has innovated a deep shale gas seismic prediction technology with pressure coefficient and gas content, fracture prediction and horizontal ground stress difference as the core – the equivalent of performing a CT scan of the strata to achieve the breakthrough in predicting the "sweet spots" of deep shale gas.

Sinopec also developed a three-dimensional fracturing technology with "precision cutting, pressurization and expansion, balanced expansion and guaranteed filling" for deep shale, which has improved the daily shale gas production of a single well to break the 300,000, 400,000 and 500,000 cubic meters marks in succession.

As per MRC, China Petroleum & Chemical Corporation (Sinopec) and QatarEnergy have signed a long-term Liquified Natural Gas (LNG) purchase and sales agreement for the annual supply of four million tons of LNG to Sinopec. Both parties will work together on Qatar's North Field Expansion Project. The 27-year long-term LNG purchase and sale agreement is an important part of the integrated cooperation between the two sides. Sinopec Chairman Ma Yongsheng and Qatari Minister of State for Energy Affairs, President and CEO of QatarEnergy, H.E. Saad Sherida Al-Kaabi, formally signed the agreement together during an online ceremony.

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China Petroleum & Chemical Corporation (Sinopec) and QatarEnergy have signed a long-term Liquified Natural Gas (LNG) purchase and sales agreement for the annual supply of four million tons of LNG to Sinopec, said the company.

Both parties will work together on Qatar's North Field Expansion Project. The 27-year long-term LNG purchase and sale agreement is an important part of the integrated cooperation between the two sides. Sinopec Chairman Ma Yongsheng and Qatari Minister of State for Energy Affairs, President and CEO of QatarEnergy, H.E. Saad Sherida Al-Kaabi, formally signed the agreement together during an online ceremony.

China and Qatar have enjoyed friendly and close ties while building synergies in the energy sector, Ma said. The healthy level of diplomacy creates a favorable environment for both sides to continuously deepen their cooperation.

"The signing of this agreement aligns with Sinopec's adherence to green, low-carbon, safe, and sustainable development," Ma said. "The LNG supply will help meet the demand for natural gas in the Chinese market, but also further optimize China's energy mix while enhancing the security, stability, and reliability of energy supply."

"We are delighted to have reached this agreement, which will further strengthen the excellent bilateral relationship between China and Qatar," said H.E. Mr. Al-Kaabi. "The agreement will help to meet China's growing demand for clean energy. This cooperation, which spans different fields and will last for 27 years, marks an extraordinary and exciting new chapter of cooperation between the two sides.

Commissioning of the Northern Gas Field Expansion Project is slated for 2026. This agreement is the second long-term LNG purchase and sale agreement signed between Sinopec and QatarEnergy, and the first long-term LNG purchase and sale agreement for the Project.

We remind, China Petroleum & Chemical Corporation (Sinopec) has successfully produced China's first batch of large tow carbon fiber at the company's production base in Shanghai, making the company the first in the country and fourth in the world to possess large tow carbon fiber technology.

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BP Plc will market Guyana's share of crude oil produced over the next year from two offshore production platforms, the South American country's Ministry of Natural Resources said, as per Reuters.

Guyana is home to one of the largest oil discoveries in the last decade, with about 11 B barrels found to date. A consortium that controls the country's crude output expects to pump 1.2 MM barrels per day (bpd) by 2027, up from an expected 380,000 bpd at year-end.

The London-based oil company agreed to market the state's share produced from the Liza Destiny and Liza Unity platforms at no charge per barrel, according to a ministry statement on Thursday. It replaces a Saudi Aramco trading unit, which previously held the contract.

bp did not reply to requests for comment on the contract. Along with Spain's Repsol and Italy's Eni, it has received cargoes from the county's offshore oilfields this year, vessel tracking data showed. Its proposal to take over as marketing agent was chosen over 13 others, the ministry said. The statement did not identify the others and the ministry did not reply to a request for details.

Through mid-year, Guyana's share of oil production from the consortium composed of ExxonMobil, CNOOC Ltd and Hess Corp was worth USD307 MM. The group markets two crudes: a medium to light sweet oil called Liza, and an even lighter grade called Unity Gold.

The government recently said it would auction 14 offshore blocks to increase output by adding more oil producers. Guyana has not yet disclosed a timetable but indicated it could hold the auction by May.

BP will market crude to refiners, provide benchmark and performance comparisons, and help the government understand the behavior and yields of the Liza blend, the ministry said.

We remind, BP refinery in Rotterdam processes about 400,000 barrels of oil annually and is an important supplier of diesel to Northern Europe. BP's final offer in talks over a new collective labor agreement under discussion since April had been for a 5% wage increase and one-off bonus of 4,000 euros (USD4,000).

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Poland is seeking German support to slap EU sanctions on the Polish-German section of the Druzhba crude pipeline so Warsaw can abandon a deal to buy Russian oil next year without paying penalties, two sources familiar with the talks said, as per Reuters.

The sources also said the pair are nearing an agreement for Poland to coordinate seaborne oil supplies to Germany via Gdansk and part of Druzhba to facilitate Poland's purchase of the Russian-owned Schwedt refinery in Germany.

The EU has pledged to stop buying Russian oil via maritime routes from Dec. 5 but Druzhba is currently exempt from sanctions. That presents a problem for Polish refiner PKN Orlen which has a long-term deal to purchase Russian oil via the pipeline and would need to pay penalties to break the contract.

If the EU were to impose sanctions on Druzhba - or at least its northern section supplying Poland and Germany - both countries would be able to get out of their Russian oil importing commitments penalty-free.

The southern section of the pipeline supplies Hungary, Slovakia and the Czech Republic which, unlike Poland and Germany, would struggle to diversify their oil imports.

According to the sources, the Polish climate ministry and German economy ministry are in the final stage of talks on a memorandum of understanding on oil logistics, which could unlock non-Russian flows and help Poland’s top refiner pursue its interest in Schwedt.

Germany remains committed to not using Russian oil from 2023 and is working on a solution with Poland to secure the supply of Schwedt, a spokeswoman for the economy ministry in Berlin said on Friday. The Polish climate ministry was not immediately available to comment.

Germany has put Schwedt under a six month trusteeship, stopping short of nationalizing the refinery, and is seeking ways to supply it with oil.

Poland and Germany promised in spring to try to end Russian oil imports via Druzhba's northern leg by the end of year but Orlen remains tied to its contract with Russian oil and gas company Tatneft.

The Polish refiner has nominated supplies for Druzhba for 2023 as stipulated by the contract but these would stop if the pipeline is hit by sanctions, one of the sources said.

Orlen declined to comment on Friday.

The company has already cut its reliance on Russian oil to 30% of its requirement, replacing it with deliveries from Saudi Arabia and Norway among others.

Kommersant newspaper reported earlier this month that Orlen had submitted an application to the Russian oil pipeline operator Transneft for the supply of 3 MMt of oil to Poland through Druzhba in 2023.

We remind, Polish oil refiner PKN Orlen has submitted an application to the Russian oil pipeline monopoly Transneft for the supply of 3 MMt of oil to Poland through the Druzhba pipeline system in 2023 under continuing long-term contracts.

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SIBUR (Moscow, Russia) says it is developing and testing a catalyst for use in the production of linear alpha-olefins as part of the company’s strategic program to strengthen its technological independence, said the company.

Pilot tests have taken place for the use of zirconium tetra-isobutyrate, with the catalyst developed by specialists from Sibur’s NIOST research center at Tomsk and the Nizhnekamskneftekhim Scientific and Technical Center (STC), it says.

SIBUR , Russia’s largest producer of petrochemicals and plastics, plans to build a production plant with a catalyst capacity of 50,000 metric tons/year by 2024 at Nizhnekamskneftekhim (Nizhnekamsk, Tatarstan, Russia), it says. Zirconium tetra-isobutyrate and hexene are mandatory components in the polyethylene (PE) production chain, enabling the manufacture of special polymer grades with improved properties for sectors including medical products, packaging materials, and gas and water supply systems, according to the company.

Domestic production by SIBUR of key components in small- and medium-tonnage chemicals is a “necessary element in maintaining the stability of the main technological chains,” it says. The company recently announced the development and testing of hexene, another key component for the production of polymers, with plans to build a 50,000-metric tons/year plant, also at Nizhnekamsk, with start of operations planned in the second half of 2024. Hexene is used in the production of high- and low-density polyethylene.

We remind, SIBUR has launched production of PET granules using recycled feedstock. The new product, Vivilen rPET granules, contains up to 25–30% recycled polymers and will now be manufactured at POLIEF, said the company.
Once the facility reaches its design capacity, each year POLIEF will be able to produce up to 144,000 tonnes of Vivilen PET granules with a share of recycled content.

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