China aims to produce 15 billion cubic meters of gas from South China Sea by 2015

China aims to produce 15 billion cubic meters (bcm) of natural gas as a year from the South China Sea by 2015, the energy administration said on Monday, raising the possibility of disputes with neighbours over over-lapping claims in the sea.

The National Energy Administration (www.nea.gov.cn), said in its 2011-2015 five-year plan that the South China Sea would "form the main part" of the country's offshore gas exploration plans.

China is in dispute with several of its neighbours over claims to parts of the oil and gas-rich sea, including the Philippines, Taiwan, Vietnam, Brunei and Malaysia. China lays claim to almost the whole of the sea.

The energy administration did not specify in its plan, published on its website (www.nea.gov.cn), which particular parts of the sea it intended to exploit for gas.

The administration said China's total offshore output was expected to reach 20 bcm by 2015, with 15 bcm from the South China sea. Total national production is expected to be 176 bcm by 2015, including 138.5 bcm of conventional natural gas.

Output last year reached 102 bcm.

With consumption expected to reach 230 bcm by the end of 2015, China's would depend on overseas supplies for about 35 percent of its needs, up from 15 percent in 2010, the administration said.

"This will bring new challenges to the country's energy security, and it must do its utmost to boost effective domestic supplies while at the same time optimising the natural gas consumption mix," it said.

The office also said the 2011-2015 period would be used to "lay the foundations" for the large-scale development of the shale gas sector over the following five-year period.

CNOOC, China's biggest offshore oil producer, said in August that it was inviting foreign companies to explore for oil and gas in 22 blocks in the South China Sea region. None of them were believed to be in disputed territory.

CNOOC, which is driving exploration and production in the South China Sea, revealed last month that it had found a "big" gas field in the sea's Yinggehai basin, which the company was currently evaluating.-Interaksyon (December 03, 2012 9:24PM)