Coal Bed Methane : Our CBM Areas
ORDOS BASIN
The Ordos Basin in Shanxi Province,
dubbed the country's "energy bank for the 21st century," is considered one of the best prospective areas for CBM and natural gas opportunities in China.
Located in northwest China, the Ordos Basin covers an area of some 370,000 sq km and is China's second-largest sedimentary basin. The natural gas reserve of Ordos Basin is estimated to be 10.7 trillion cubic meter.
To date, 15 large and medium-sized Chinese cities enjoy the convenience of natural gas produced in the Ordos Basin. While China is widely regarded as one of the early users of natural gas, natural gas only accounts for 3 percent of the country's total energy consumption and some one tenth of the world's average.
Exploration for natural gas in the Ordos Basin has become a strategic move in China's ongoing energy supply adjustment. It is estimated that the consumption of natural gas will amount to 10 percent of China's total energy consumption by 2020.
The Ordos Basin has entered the stage of large-scale development with a big number of energy projects getting under construction. International players in this area include Shell and Total. Shell, who have experienced significant success with their Changbei Tight Gas Sands project towards the center of the Ordos Basin, have also recently made Coal Bed Methane (CBM) one of their core businesses in Asia and China. They have secured the Silou North CBM Production Sharing Contract with 100% participating interest, and have entered into a number of wide ranging CBM related agreements with Australian CBM major, Arrow Energy.
Apart from the presence of local markets, Ordos Basin also offers developed infrastructure for effective downstream distribution, with two major pipelines, the Ordos- Beijing Pipeline and the West-East Pipeline that can carry production to distant markets.
ZIJINSHAN BLOCK
Pacific Asia Petroleum’s 100% owned Zijinshan asset covers an area of 175,000 acres in the Ordos Basin in the Shanxi Province, second largest petroleum-bearing basin in China.
To Zijinshan block’s immediate west are commercialized gas fields estimated by CUCBM (China United Coal Bed Methane Company) to contain gas resources of approximately 50 trillion cubic feet of gas (50 TCF).
China United Coal Bed Methane Company (CUCBM) estimated that the Zijinshan Asset has potential gross gas resources in excess of 3.8 TCF.
International energy auditor Cawley, Gillespie & Associates valued the asset at $400 million.
The Zijinshan block is in close proximity to the major West-East gas pipeline and the Ordos-Beijing Pipeline, which link the gas reserves in China’s western provinces to the markets of the Yangtze River Delta, including Shanghai and Beijing. Pursuant to the current Chinese economic stimulus initiative, another new pipeline dedicated to CBM is under construction in the Ordos Basin, again in close proximity to the Zijinshan Asset.
In April 2008, the Ministry of Commerce of The People’s Republic of China approved Pacific Asia’s entry into Production Sharing Contract (PSC) with
CUCBM, the Chinese-designated company holding exclusive rights to negotiate with foreign companies with respect to CBM production, for the exploitation of CBM resources in the Zijinshan block.
Drilling operations on Zijinshan block has begun in October 2009.
Click to enlarge map
|
