Review and Prospect of Sino-US Oil & Gas Cooperation 3- Zhang Yaocang- Sinopec- Engli… · Review...

中国石油化工集团公司中国石油化工集团公司

Review and Prospect of SinoReview and Prospect of Sino--US Oil & Gas CooperationUS Oil & Gas Cooperation

China Petrochemical CorporationChina Petrochemical Corporation

September, 2006September, 2006


I. Review on Sino-US Oil & Gas CooperationI. Review on SinoI. Review on Sino--US Oil & Gas US Oil & Gas CooperationCooperation


“Regulations of the People’s Republic of China on the Exploitation of Offshore Petroleum Resources in Cooperation with Foreign Enterprises” was announced by the State Council in 1982. “Regulations of the People’s Republic of China on Sino-foreign Cooperation in the Exploitation of Continental Petroleum Resources”was announced by the State Council in 1993.

The opening-up of onshore and continental resources attracts many foreign oil companies.

“Regulations of the People’s Republic of China on the Exploitation of Offshore Petroleum Resources in Cooperation with Foreign Enterprises” was announced by the State Council in 1982. “Regulations of the People’s Republic of China on Sino-foreign Cooperation in the Exploitation of Continental Petroleum Resources”was announced by the State Council in 1993.

The openingThe opening--up of onshore and continental resources up of onshore and continental resources attracts many foreign oil companies.attracts many foreign oil companies.

1、Oil & gas E&P11、、Oil & gas E&POil & gas E&P


1.1 Offshore Cooperation1.1 Offshore Cooperation

CATC(CNOOC/Chevron Texaco JV formed in 1985) discovered Huizhou Oilfield. Production started in 1990.

Block 11/05 was under joint exploration between CNOOC & ConocoPhillips. A major oilfield with a geologic reserve of 600million tons was discovered in 1999.

CATC(CNOOC/Chevron Texaco JV formed in 1985) discovered Huizhou Oilfield. Production started in 1990.

Block 11/05 was under joint exploration between CNOOC & ConocoPhillips. A major oilfield with a geologic reserve of 600million tons was discovered in 1999.

Block Zhaodong was under joint E&P between CNPC &Apache in 1993. The discovery of 43.8 million tons of proved reserve in 2005 was a hallmark.

In 2001, CNPC & Burlington Resources jointly developed Mid-Sichuan Project of the Southwestern Gas-field. In 2004, Bajiaochang Gas-field was put into production.


1.2 Onshore Cooperation1.2 Onshore Cooperation

Chevron Texaco & Shantou Oceanic Fuel Gas Energy Inc. jointly built the largest LPG processing, storage and transportation project, which is China’s largest underground and second largest LPG tank.


2、Oil & Gas Storage & Transportation22、、Oil & Gas Storage & TransportationOil & Gas Storage & Transportation

Fujian Integrated Refining & Chemical joint investment agreement was signed by Fujian Petrochemical & ExxonMobil, with annual refining capacity expanded to 12 million tons from 4 million tons.

Fujian Integrated Refining & Chemical joint investment agreement was signed by Fujian Petrochemical & ExxonMobil, with annual refining capacity expanded to 12 million tons from 4 million tons.


3、Refining and Chemicals33、、Refining and ChemicalsRefining and Chemicals


4、Oil Product Sales44、、Oil Product SalesOil Product Sales

Fujian Oil Product Marketing Joint Investment Agreement was signed by Sinopec, ExxonMobil and SaudiAramco, being respossible for sale of the oil products produced by Fujian Integrated Refining & Chemical Project exclusively.

Sinopec & Lummus jointly developed 100 000-ton ethylene cracker, named as SL Cracker.

Sinopec & Lummus jointly developed 100 000-ton ethylene cracker, named as SL Cracker.


5、Technology Cooperation55、、Technology CooperationTechnology Cooperation

US: capital, technology, managerial expertiseChina: oil& gas resources, market, human

resourcesSino-US established good cooperation

partnership.



II. The oil & gas cooperation is in accordance with the common interests

of both China & the US.

II. The oil & gas cooperation is in II. The oil & gas cooperation is in accordance with the common interests accordance with the common interests

of both China & the US. of both China & the US.


As major consumption countries, China & the US face the risk of supply cut-off and share substantial expense for oil import.

Oil supply stability is the priority to maintain rapid and sustained economic growth. Energy policies featuring increasing supply and saving consumption are made by the two countries.

China & the US are major economies in the world and share the common interest and responsibility in maintaining market stability and protecting environment.

As major consumption countries, China & the US face the risk of supply cut-off and share substantial expense for oil import.

Oil supply stability is the priority to maintain rapid and sustained economic growth. Energy policies featuring increasing supply and saving consumption are made by the two countries.

China & the US are major economies in the world and share the common interest and responsibility in maintaining market stability and protecting environment.


China & US should further build up strategic partnership and add weight to major consumption countries in negotiating with major producing countries.

China & US should Strengthen communication, and reinforce cooperation at home and abroad.


III、Future Prospect of CooperationIIIIII、、Future Prospect of CooperationFuture Prospect of Cooperation


China is focusing on oil & gas E & P both at home and abroad.

China has the largest demand for petrochemical products in Asia. The development of petroleum &petrochemical industry promotes Sino-US cooperation further.

（i）China’s rapid growing economy provides extensive space for Sino-US Cooperation

（（ii））ChinaChina’’s rapid growing economy provides s rapid growing economy provides extensive space for Sinoextensive space for Sino--US CooperationUS Cooperation

American companies: experience, capital, technology

Chinese companies: onshore E & P technologies, capital

American companies: experience, capital, technology

Chinese companies: onshore E & P technologies, capital


（ii）The complimetarity and strengths of oil companies of the two countries provide the foundation of overseas cooperation. （（iiii））The The complimetaritycomplimetarity and strengths of oil companies of the and strengths of oil companies of the two countries provide the foundation of overseas cooperation. two countries provide the foundation of overseas cooperation.


•To invest in JV , share investment risks and make technical seminars and exchanges


Improve governmental energy-dialogue mechanism.

promote exchanges and cooperation between companies.

Improve governmental energy-dialogue mechanism.

promote exchanges and cooperation between companies.

（iii）Proposals（（iiiiii））ProposalsProposals

1. 1. Promote dialogues and exchangesPromote dialogues and exchanges

2.1 Complicated geological blocks & offshore blocks2.1 Complicated geological blocks & offshore blocks2.1 Complicated geological blocks & offshore blocks


E&P: Strengthen cooperation on onshore complicated blocks

E&P: Strengthen cooperation on offshore blocks,especially those in deep sea .

2. Strengthen cooperation in the following areas: 2. Strengthen cooperation in the following areas:

2.2 Strengthen cooperation in LNG project and E&P of gasfield2.2 Strengthen cooperation in LNG project and E&P of 2.2 Strengthen cooperation in LNG project and E&P of gasfieldgasfield


Discuss cooperation on LNG liquefaction, LNG transportation and LNG-receiving terminal construction.

Participate the E&P of E&P of gasfieldgasfield in marine deposit area of China and in overseas gas-producing countries jointly.

2.3 Strengthen cooperation on theoretical & technological research2.3 Strengthen2.3 Strengthen cooperation on theoretical & technological researchcooperation on theoretical & technological research


Develop in-depth technological technological cooperation and communication on oil & gas industry

3. Promote the establishment of coordination system with IEA3. Promote the establishment of coordination system with IEA


Proposal: US can take the lead in establishing a strategic oil reserve system involving member and non-member countries of IEA,optimizing the sharing of oil reserve，maintaining economic stability of the world.

Review and Prospect of Sino-US Oil & Gas Cooperation 3- Zhang Yaocang- Sinopec- Engli… · Review...

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