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Major oil reserves discovered at Bohai Bay

(China Daily)
Updated: 2007-03-20 08:42

"Major oil firms in China follow a consistent strategy priority for domestic oil and gas exploration and production. The new discoveries will support their strategy and solidify their business base on local oil and gas fields," Han said.

As production output at existing oil fields decreases by the year, the oil companies consistently need to explore new fields to keep the country's overall output stable.

"Oil and gas fields located in East China are generally older and are witnessing decreasing output. Therefore, the new discoveries are especially significant," Han pointed out.

China's strong demand for energy spurred PetroChina to produce an aggregate of over 1 billion barrels of oil equivalent last year with crude oil accounting for 831 million barrels.

Jiang forecast that PetroChina's oil output may rise to 2.3 million barrels a day this year, with gas production reaching 4.56 billion cubic feet a day. Its refineries will process an estimated 2.25 million barrels of crude daily.

The company recorded net income of 142.2 billion yuan ($18.34 billion) in 2006, compared to 133.4 billion yuan ($17.23 billion) a year earlier. The company posted a turnover of 689 billion yuan ($89 billion) last year, ayear-on-yearincrease of 24.8 percent.

Capital spending would increase 25 percent this year as PetroChina is forced to drill deeper and further afield for oil and gas and as it expands refineries.

Last year, higher drilling costs and wider losses at the refineries hit the firm, which posted a 13 percent drop in second-half profit.