Shell & PetroChina Turn on the Taps at Changbei Gas Field

PetroChina and Shell have started commercial production and gas delivery from the Changbei gas field.

PetroChina and Shell are jointly developing the field under a Production Sharing Contract, with Shell currently being the field development operator. Located on the edge of the Maowusu desert in the Ordos Basin of Shaanxi Province and Inner Mongolia Autonomous Region, it is the largest onshore upstream cooperative development Shell has had in China.

As Changbei goes into commercial production, it will provide natural gas to the markets of Beijing, Tianjin, Shandong and Hebei. It is expected that production will rise to the planned plateau rate of 3 billion cubic meters/yr during 2008. To attain these levels of production from the relatively difficult Changbei reservoir, Shell is applying its global technical expertise, most particularly through the use of the long multi-lateral horizontal wells.

The safe start of full commercial production on schedule on the 1st March 2007 is a significant milestone and is a practical demonstration of what the Shell/PetroChina partnership can achieve."

PetroChina and Shell signed a revised Changbei Production Sharing Contract in May 2005. Based on this contract, Shell became the development operator for the Changbei gas field. Major projects include the construction of the central processing facilities, inter-field pipelines and a drilling programme, which is expected to involve about 50 horizontal and multi-lateral wells over 10 years.