Crude output from China's huge Daqing oil field will continue to slide in 2004, falling 4.3% to 46.3 million metric tons, a China-based industry official said Tuesday.

Production at the oil field, China's largest, hit a 27-year low last year.

Despite attempts to raise the field's proven crude reserves by 30 million tons in 2004, from 10 million tons last year, it won't be easy to convert the new reserves into production quickly, the official said.

He attributed the fall in output to "the natural decline of recoverable oil reserves" after 40 years of intensive production. In 2003, Daqing's crude production fell 3.5% on year to 48.4 million tons.

The fall in Daqing's crude output will seriously reduce PetroChina's crude exports to Japan. The field is owned by PetroChina, China's largest oil and gas company.

Under government-arranged deals, PetroChina is exporting 3 million tons/year of Daqing crude to Japan for direct burning at thermal power plants.

Although the deals are scheduled to last until 2005, Japanese crude traders have said PetroChina is now reluctant to export Daqing crude to Japan because of the dwindling reserves. According to these traders, PetroChina claims it can only export about 500,000 tons/year now.

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