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BEIJING (Dow Jones Newswires), December 9, 2008
China Petrochemical Corp., or Sinopec Group, added 135 million metric tons of proven crude oil reserves at its second-largest oilfield during 2008, the company's official online newsletter reported Tuesday.
The additional proven reserves at the Tahe oil field, in the northwestern Xinjiang Uygur Autonomous Region, were 39.7 million tons more than discovered a year earlier.
As a result, total proven reserves at the field has now reached 996 million tons of oil equivalent, the report said.
The Tahe field is vital to the Sinopec Group's efforts to increase oil and gas production, as it is considered the only of China's 11 largest oil fields that isn't already past its peak production period.
"Based on our understanding of the geology at the Tahe field, we conservatively estimate that about 20% of the additional 135 million tons, or 192 million barrels of oil equivalent of oil and gas in place could be recoverable," said Gordon Kwan, head of China Energy Research at CLSA.
"This has the potential of lifting Sinopec's total proven oil and gas reserves by about 5% from the current 4 billion barrels of oil equivalent estimate following more extensive appraisal and development drilling in the first half of 2009," Kwan said.
Sinopec Group is the parent company of the listed China Petroleum & Chemical Corp., or Sinopec Corp.
Although there is no meaningful earnings impact in the short term, the news should be positive to sentiment at a time when China is reforming its domestic fuel pricing system, Kwan said.
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