PetroChina Begins Development at Kela-2 Field

PetroChina and its partners this week started a 4 billion yuan development project at the Kela-2 natural gas field, expecting to deliver gas to areas around Shanghai early next year, a company official said Thursday.

Gas deliveries from the field in the Tarim basin of northwestern China's Xinjiang Autonomous Region should start in January next year at an initial per-well gas flow of 4.7 million cubic meters a day, the official told Dow Jones Newswires.

The development involves drilling four production wells. Drilling at the first well, Kela 2-3, started Tuesday and is expected to be complete in August, he said.

PetroChina aims to produce 10 billion cubic meters of natural gas a year from the field when the four wells are in full production.

The field has total gas reserves of 284 billion cubic meters, with 229 billion cubic meters recoverable.

PetroChina signed a framework agreement in July 2002 with Shell, ExxonMobiland Gazprom, allowing each to take a 15% stake in field development and production.

PetroChina, China's largest oil and gas company, has already started delivering gas to Shanghai from the Ordos basin through a 3,900-kilometer gas pipeline linking the Tarim basin and eastern China.