Chevron, PetroChina Commence Natural Gas Production in China

U.S. energy giant Chevron Corporation along with PetroChina Co. Ltd. − the largest integrated oil company in China − started producing natural gas in the southwestern area of China at the end of last year, after a long delay. The news is as per China National Petroleum Corporation, the parent company of PetroChina.

Gas well-A in the Luojiazhai field of Southwest China commenced production of natural gas commercially on Dec 30. This is eight years after the companies entered into a 30-year production sharing deal in 2008.

Among the three phases of the Chuandongbei development, which will likely cover 309 square miles, the Luojiazhai project is the first. As per sources, the first phase is projected to produce 3 billion cubic meters of gas annually. Chevron and PetroChina will operate in the same area for the second and the third phases.

Chevron with a 49% interest in the sour gas project is the operator. PetroChina is the owner of the remaining stake. Investors should note that Chevron is a well known operator of sour gas, which is basically natural gas having high hydrogen sulphide content.

San Ramon, CA-based Chevron is one of the leading publicly traded oil and gas companies in the world, based on proved reserves. It is engaged in oil and gas exploration and production, refining and marketing of petroleum products, manufacturing of chemicals, and other energy-related businesses.

On the other hand, PetroChina operates in segments like Exploration & Production, Natural Gas & Pipelines, Refining & Chemicals, and Marketing.

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