BP and China National Petroleum Corp. (CNPC) have signed a production sharing contract (PSC) for shale gas exploration, development and production in the Neijiang-Dazu block in the Sichuan Basin, China. Witnessed by BP Group Chief Executive Bob Dudley and CNPC Chairman Wang Yilin, the contract is BP’s first shale gas PSC in China and covers an area of approximately 1500 km2. CNPC will be operator for this project.
“We are pleased to reach this significant milestone as part of our strategic partnership with CNPC, building on our successful cooperation in and outside of China,” Dudley said. “We are looking forward to working together with CNPC on technology, operational and subsurface techniques in unconventional resources. We will bring our worldwide experience to our first unconventional gas project in onshore China with CNPC. We will combine this with CNPC’s knowledge and experience to bring gas to China’s growing clean energy market. China continues to be an important part of BP’s portfolio.”
This PSC is the first achievement from BP and CNPC’s framework agreement on strategic cooperation that was signed in October 2015.
CNPC Chairman, Wang, commented: “CNPC and BP's existing cooperation covers various areas including retail business in China, overseas upstream exploration and development and international trading. Building upon the framework agreement on strategic cooperation signed last year, this unconventional resource PSC is a manifestation of our deepening cooperation. By leveraging the parties' complementary advantages, CNPC and BP will jointly realize the efficient development of unconventional resources.”
BP’s Energy Outlook (2016 edition) expects that by 2035 shale gas will account for a quarter of the total gas produced globally.
“As a new strategic industry for China, the exploration, development and production of shale gas will significantly benefit China’s energy mix in a long run,” commented Edward Yang, BP China President. “Through this PSC, BP once again clearly reaffirms our commitment to being one of China’s preferred energy partners to support the country in developing cleaner energy for a greener future.”
Edited from press release by Angharad Lock
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