Oil Industry

Before 1949, the Chinese oil market was monopolized by American Mobil, Texaco and British Asia companies. In 1948, the total output of crude oil was only 89,000 tons. On September 25, 1949, the People's Liberation Army formally took over control of the Yumen Oil Field in Gansu Province. In February 1956, the newly-established Ministry of Oil Industry held the first conference on petroleum prospecting, which demanded that power and labor be concentrated on petroleum prospecting in large basins. Soon later, a number of oil fields were respectively found at Karamay in the Xinjiang Uygur Autonomous Region and Lenghu in Qinghai Province. This marked the beginning of the new China's oil industry. It was historical in 1956 that China's output of crude oil broke a record to come to 1 million tons. In 1958, the Ministry of Oil Industry ordered that three petroleum prospecting bureaus be established in Songliao, North China and East China regions. Priority was given to prospecting in the Songliao Basin, which was believed to be a prelude that the development of China's oil industry would move eastward. In 1959, an enterprise star was rising in China's oil sector, which was the famous Daqing Oil Field. A production campaign was launched in Daqing in the early 1960s, which was an important turning point in the history of development of the oil industry. By 1965, self-sufficiency of oil products was eventually realized in China. Thanks to large-scale prospecting in the Bohai Sea, some new oil fields with considerable reserves were found one after another, including the Shengli, Dagang and Liaohe oil fields. These new fields enabled the output of China's crude oil broke the record of 100 million tons in 1978, thus joining other countries on the list of major oil producers in the world. Since the new policy of reform and opening up was adopted in China in the late 1970s, the third development stage of oil and natural gas prospecting has begun. This cross-country prospecting has been conducted in the Tarim Basin, the Junggar Basin and the Turpan-Hami Basin in the west, the continental shelf in the Huanghai Sea and the East China Sea in the east, and the offshore ares in the South China Sea. During the period from 1979 to 1996, the proven recoverable reserves of China's oil was 1.27 times that thirty years ago and natural gas 5.5 times. In comparison with that of thirty years ago, the annual output of crude oil increased by 51.5 percent and natural gas 46.5 percent. The annual output of crude oil in 1996 reached 157 million tons (coming to 161 million tons by 1998) and that of natural gas 20.1 billion cubic meters. By that year, twenty bases for oil and gas prospecting and development had been established, and 20-odd large-scale petrochemical industrial enterprises founded with the production capacity of crude oil amounting to 210 million tons per year. As a result, the proportion of oil and gas production in the whole energy sector rose to 19.1 percent from less than 1 percent in 1949. Detail...

Main Oil Fields in China

Tarim Oil and Gas Province      Yumen Oil Province      Qinghai Oil Province      Huabei Oil Province      Xinjiang Oil Province      Tuha Oil Province      Dagang Oil Province      Jilin Oil Province      Jidong Oil Province      Southeast Gas Field

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Oil resources in China

China has announced a creation of a high-level body to integrate its energy management supervision and policies, functions that are currently dispersed among many government agencies. Below is basic information about oil resources in China. China's output of crude oil was 186.7 million tons last year, up 1.6 percent from 2006, while that of natural gas reached 69.31 billion cubic meters, up 23.1 percent, according to the China Petroleum and Chemical Industry Association. In 2007, China's imports of crude oil rose 12.4 percent to 160 million tons, according to China Customs figures. Sinopec and PetroChina, the country's leading oil producers, accounted for two thirds of the total imports. Last year, China refined 326.79 million tons of crude oil, up 6.4 percent from 2006. Output of refined products -- gasoline, diesel and kerosene -- was 195 million tons, up 7.2 percent. Deng Yusong, a research member of the Development Research Center of the State Council, predicted that China's oil consumption would continue to grow in 2008, with domestic crude oil output growth of 1-2 percent. Sinopec produced 291.67 million barrels of crude oil in 2007, up 2.27 percent from 2006. PetroChina, the country's largest oil producer, had an output of oil and natural gas of 828 million barrels of oil equivalent in the first three quarters of 2007, up 4.3 percent year-on-year. China raised domestic oil prices last November and asked state-owned oil giants to import oil and give orders to local refineries. Meanwhile, the government extended subsidies to refineries to cover the losses they incurred by selling oil at state-fixed prices. Government subsidies to Sinopec, the nation's largest oil refiner, reached 10 billion yuan in 2005 and 5 billion yuan in 2006. Sinopec reportedly received further subsidies in 2007. The situation highlighted the importance of the strategic oil reserve program, which started in 2004. The reserve program was designed to offset oil supply risk and reduce the impact of fluctuating energy prices worldwide on China's domestic market for refined oil. The first national oil reserve base under the program was filled as of early December. In 2007, China announced its biggest discovery of an oilfield in four decades, with reserves of 1 billion tons, or about 7.35 billion barrels.