China National Petroleum Corp., the country’s biggest oil and natural gas producer, discovered a natural gas reserve that is big enough to supply the nation’s needs for two years.
The find in Anyue county in the southeastern province of Sichuan has a reserve of 440 billion cubic meters, of which 308 billion cubic meters is technically recoverable, CNPC said in a statement posted on its website today. The state-owned company is the parent of PetroChina Co. (857) The statement didn’t specify if the listed unit owns the asset.
China consumed 169 billion cubic meters of gas in 2013, according to the National Development and Reform Commission. The country is seeking to increase the use of the cleaner-burning fuel to replace coal to tackle air pollution in its biggest cities including Beijing and Tianjin.
The find is “a big boost to CNPC and PetroChina, as a new discovery of this scale can bring huge profit, once commercial production starts,” said Shi Yan, an analyst with UOB-Kay Hian Ltd. in Shanghai. “It will help strengthen China’s energy security as high output means less dependence on imports.”
China imported 53 billion cubic meters of natural gas in 2013, or 32 percent of its total consumption, according to CNPC’s research institute.
A testing well at the site has produced as much as 1.1 million cubic meters of natural gas a day, CNPC said in the statement. Production facilities being built at the site will help raise output to as much as 10 billion cubic meters of gas a year.
PetroChina produced 58 billion cubic meters of natural gas in the first nine months of 2013, according to its third-quarter earnings statement on Oct. 29. The company’s shares gained 1.6 percent to HK$7.67 in Hong Kong today, compared with a 0.3 percent decline in the city’s benchmark Hang Seng Index.
The Anyue gas field belongs to Southwest Oil & Gasfield Co., a unit of the listed company, according to an Aug. 28 statement posted on the Environmental Protection Bureau of Suining’s website. Suining is the city that has jurisdiction over an area where most of the gas reserves were found. PetroChina spokesman Mao Zefeng couldn’t be reached for comment.
To contact the reporter on this story: Aibing Guo in Hong Kong at firstname.lastname@example.org