Sinopec to close taps on four fields

China

BEIJING , February 17, 2016 – Chinese state-run Sinopec signalled on Tuesday its intention to shut down four fields at Shengli, China’s second-largest producing oilfield.

Announced in the company news paper Shengli Daily, Sinopec selected the Xiaoying, Yihezhuang, Taoerhe and Qiaozhuang fields to be shut. Exploited since 1964, Shengli is a now mature asset with gradually declining output. According to state press agency Xinhua, production slumped from 557,000 bopd in 2014 to 543,700 bopd last year. Lower oil prices meant USD 1.41 billion in potential revenue was lost over 2015.

Output is also expected to decline at China’s most prolific field, Daqing. Operated by China National Petroleum Corporation, production of the country’s oldest field is expected to fall to 640,000 bopd by 2020, down from levels of around 800,000 bopd in 2014.

The Shengli field, located in Shandong province, comprises some 78 oil and gasfields and has produced around one-fifth of China’s domestic output over its lifetime. The Hua-8 well in 1961 confirmed the discovery if the oilfield.

The country is presently the world’s fourth-largest producer.

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