The Haiyang Shiyou 982 drilling rig for the Liuhua 29-2 gas field in eastern South China Sea is seen in this undated photo released Thursday. Operated by the Shenzhen branch of China National Offshore Oil and Gas Company (CNOOC), the gas field has commenced production. Courtesy of CNOOC
Major Chinese offshore oil and gas firm, China National Offshore Oil and Gas Company (CNOOC), has started producing gas from the Liuhua 29-2 field in the eastern part of the South China Sea, the State-owned company announced Thursday.
The Liuhua 29-2 gas field is located 300 kilometers southeast of Shenzhen with a water depth of about 750 meters, according to an announcement of the country’s biggest offshore driller, developer of the project.
Operated by CNOOC Shenzhen branch, it is said to be the first deepwater gas field independently developed by China.
This year’s daily production peak of natural gas is expected to reach 1.15 million cubic meters, or 420 million cubic meters annually. The field’s gas production can satisfy the needs of 8 million residents when it reaches Guangdong Province and joins the national gas pipeline network.
The project will boost the low-carbon development of the Guangdong-Hong Kong- Macao Greater Bay Area (GBA) and invigorate new vitality for Shenzhen in building a global marine central city, the company said.
The eastern South China Sea accounted for about 242,000 barrels of oil equivalent a day for the company in 2019, about 17 percent of its total production, in depths ranging from 100 to 1,500 meters, according to CNOOC filings.
The eastern South China Sea, where the Liuhua 29-2 gas field is located, is the main gas production area of offshore gas, having produced 6 billion cubic meters of gas a year for three straight years, taking up one quarter of yearly gas consumption in the GBA.
It generated 30 billion yuan (US$4.6 billion) in sales last year. It has been also a key driving force for Shenzhen’s industrial growth, contributing 5.4 billion yuan to Shenzhen economic investments.
The South China Sea deepwater gas exploration began with the production of Liwan 3-1 gas field, China’s first deepwater gas developed by CNOOC and Canada’s Husky Energy in April 2014.
So far, the deepwater gas fields in South China Sea has accumulatively produced 40 billion cubic meters of gas, equivalent to the amount that can be consumed by 250 million families for one year.
During the 14th Five-Year Plan, according to Wang Dongjin, CNOOC chairman, the company will increase exploration of gas, construct diversified gas production and supply systems, assist energy transformation, and help realize the GBA’s development goals.