BEIJING - French oil
giant Total said February 21 it would finalize an
agreement by July with China's biggest oil
producer, PetroChina, to start exploring a gas
field in the Erdos Basin of northwestern China.
Total will sign a product-sharing contract
(PSC) with Hong Kong-listed PetroChina in the
first half of the year for a gas field in the
resource-rich basin, bordering five regions such
as Shaanxi province and the
Inner Mongolia Autonomous
Region, a senior
official from Total China told
China Daily. "Our talks with PetroChina are now at
the final stage," the official said, declining to
be named.
Jacques de Boisseson, president
of Total (China) Investment Co Ltd, told reporters
on February 21 that Total is talking with various
oil companies in China, including PetroChina and
Sinopec, about possible partnerships in areas such
as oil and gas exploration and marketing.
"There will be a project this year in the
[oil and gas] exploration field," the Total China
chief said on the sideline of a Sino-French oil
and gas summit in Beijing. Both Total
officials said they didn't have concrete figures
concerning the scale of the project's investment,
or their shares in the gas field.
Foreign
companies are entitled to a stake of less than 50%
in a two-party partnership with their Chinese
counterparts for oil and gas exploration in China,
Che Changbo, a director at the Ministry of Land
and Resources (MLR) said. Bi Jianguo, spokesman of
PetroChina, declined to comment.
China
pumped 7.5 billion cubic meters (bcm) of natural
gas from the Erdos Basin in 2004, 19% of the
country's total gas output, figures from the land
and resources ministry said. Recoverable reserves
from the northwestern basin amount to 290.4 bcm.
In another attempt to cash in on China's
huge gas demand, the French firm is also talking
with oil companies in China, including the
country's third-biggest oil producer, China
National Offshore Oil Corp (CNOOC), to supply
liquefied natural gas (LNG) to gas terminals along
the eastern coast. The imported gas will come from
Total's gas reserves in the Middle East, Boisseson
said. The company can supply "as much as they
want," he said.
Total is eyeing all the
other terminals except the two owned by CNOOC in
Guangdong and Fujian provinces in the
south, whose LNG sources have been contracted to
Australia and Indonesia. The government has
approved about ten LNG terminals along the
energy-intensive eastern coast, which belong to
PetroChina, Sinopec and CNOOC, market observers
said.
On the refining and marketing front,
the Total China president said Total would work
with Beijing-based Sinochem to increase the number
of its service stations in China to 500 within the
next five years. These service stations will be
located in Beijing, Tianjin, Hebei and Liaoning provinces in
north and east China, he said.
Boisseson
said Total and Sinochem put five or six service
stations into operation in the capital city.
According to the Total-Sinochem accord, as many as
58 service stations will be built in Beijing by
the year 2012. Total may use refined oil products
from its 200,000-barrel-ton-a-day joint refinery
with Sinochem in Dalian of Liaoning province, or
purchase refined products from Sinopec and
PetroChina, to fill its service stations,
Boisseson said.
