Released on = March 15, 2007, 3:29 am

Press Release Author = Shushmul Maheshwari

Industry = Energy

Press Release Summary = Daqing, the largest but fast-exhausting oilfield of China,
is increasingly depending on its recently discovered natural gas reserves to retain
its production levels.

Press Release Body = The largest oil field in China, Daqing, is depleting fast. So
it is increasingly depending on natural gas to maintain its production level. The
field, located in Heilongjiang province of China, is building its hopes on recently
found deep natural gas reserves that nay be accessed with advanced technologies.

As per the National Development and Reform Commission (NDRC), the principal economic
planner, the China Daily reported, “Natural gas will be an important driving force
to stabilize Daqing oilfield\'s production. Daqing has set a target of discovering
200 Billion Cubic Meter of natural gas during the 11th Five Year Plan (2006-10).”

By 2005, Daqing had the proven gas reserves of 400 Billion Cubic Meter but the focus
has now shifted to extract deeply stored natural gas with an estimated reserves of
1200 billion cubic meter.

Daqing operator China National Petroleum Corporation (CNPC) hopes that natural gas
will account for 9.5% of the total output in 2010, and 22.5% in 2020, the paper
reported. The current percentage was not given.

Daqing, that attained near-mythical status during the starting years of communist
rule as an example of the Maoist can-do spirit, has been fighting with threats that
it might be slowly losing its oil reserves.

CNPC recently said that it plans to expend $32 Billion (250 Billion Yuan) to boost
the oil production at main oilfields in the eastern parts of China, while developing
potential oilfields in the western parts of the country.

In addition to keeping Daqing in the mainstream, the enhanced reliance on natural
gas also matches the China’s energy strategies. China consumes only 3% natural gas
in its total fuel consumption as against 20% at global level. Development of LNG as
a clean energy alternative is a priority during the 11th Five Year Plan.

The RNCOS report “Liquefied Natural Gas (LNG) in China” states that depleting fossil
fuel reserves, rising gas fired power generation, increasing demands, security &
diversity of supply issues, and environmental concerns – all are working as basic
growth drivers for the China’ LNG industry.

The research report also discusses the detailed overview of China LNG industry, LNG
infrastructure, pricing, and supply & demand status in China, factors driving growth
in the sector, opportunities and challenges for the sector, and future outlook of
the market.

About RNCOS:

RNCOS, incorporated in the year 2002, is an industry research firm. It has a team of
industry experts who analyze data collected from credible sources. They provide
industry insights and analysis that helps corporations to take timely and accurate
business decision in today\'s globally competitive environment.

For more information visit: http://www.rncos.com/Report/IM0302.htm
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