China's biggest oilfield, facing depleting output, is increasingly relying on natural gas to maintain production levels.

"Natural gas will be an important driving force to stabilize Daqing oilfield's production," the National Development and Reform Commission (NDRC), the top economic planner, said on its website.

By 2005, proven gas reserves in Daqing in Northeast China's Heilongjiang Province hit 400 billion cubic meters (bcm) but the focus now is on extracting deep natural gas, whose reserves are estimated at 1,200 bcm.

Deep natural gas exists in deposits far underground at typical depths of around 3,000 meters, way beyond conventional drilling depths, which are usually only a few hundred meters.

Premier Wen Jiabao, who visited an oilfield in Jilin Province over the weekend, called for adoption of new technology to tap reserves, according to a Xinhua report yesterday.

"Daqing has set a target of discovering 200 bcm of natural gas during the 11th Five Year Plan (2006-10)," the NDRC said.

Operated by China National Petroleum Corporation (CNPC), Daqing is the country's largest oilfield, with an annual production of 45 million tons oil equivalent.

CNPC's target is to keep Daqing's production at 42 million tons oil equivalent annually by 2010, when natural gas will contribute to 9.5 percent of the total output.

By 2020, annual gas production at Daqing is forecast to be at 11.5 bcm, or 22.5 percent of its 40-million-ton oil equivalent production.

"As oil production is decreasing year on year, it is necessary to further explore gas resources at Daqing to make the overall output stable," Han Xuegong, a senior analyst with CNPC, told China Daily.

Natural gas accounts for only 3 percent of fossil fuel consumption in China, compared to 20 percent globally. As a clean energy option, it is, and should be, a development priority during the 11th Five Year Plan, Han said.

Jiang Jiemin, president of CNPC, said recently that the company plans to spend 250 billion yuan ($32 billion) to raise the production at major oilfields in the eastern part of the country, while developing potential fields in the western part.

NDRC officials predicted that China's natural gas demand would reach 100 bcm by 2010, compared to 60 bcm produced last year. By 2020, demand would hit 200 bcm, with production at only 140 bcm.

During the 10th Five Year Plan (2001-05), proven natural gas reserves reached 2.6 trillion cubic meters, up 117 percent compared with the previous five-year plan. Major gas fields are located in Xinjiang Uygur Autonomous Region, Sichuan Province and northeastern China.

Source: China Daily