January 22, 2013 / 6:00 AM / in 5 years

Sinopec to boost output in high-sulphur gas fields -report

BEIJING, Jan 22 (Reuters) - Sinopec, China’s second-largest oil and gas producer by output, will add 10 billion cubic metres (bcm) of annual natural gas production capacity by 2015 using its own technology to develop high-sulphur gas fields, the China Daily said on Tuesday.

Natural gas consumption in China, the world’s top energy user, is expected to be 230 bcm in 2015, up from more than 130 bcm in 2011, the government has said.

In 2011, natural gas accounted for only 4.5 percent in China’s energy mix, versus 23.7 percent of primary energy consumption worldwide.

China has proven reserves of more than 1 trillion cubic metres of natural gas with high sulphur content, or sour natural gas, the newspaper quoted Cao Yaofeng, vice president of Sinopec parent Sinopec Group, as saying.

It has been a technical challenge for Chinese firms, including Sinopec and top oil and gas producer China National Petroleum Corp (CNPC), to develop high-sulphur gas which contains a high content of poisonous hydrogen sulphide that could be lethal if not properly treated.

Companies have sought international expertise to tackle the sour gas. Chevron is in joint venture with CNPC to develop several such gas fields in Sichuan.

In 2003, a blow-out at a CNPC natural gas well in southwest China’s Chongqing turned 25 square km (10 sq miles) of farmland into a lethal zone, killing 243 people and poisoning thousands as they slept or scrambled to escape a toxic cloud of hydrogen sulphide.

Sinopec’s Puguang gas field is the largest high-sulphur natural gas field in the country, with proven reserves of 412.2 bcm, the paper said.

By applying the company’s sour-gas development technology, Puguang, in the southwestern province of Sichuan, produced about 10 bcm of natural gas in 2012, accounting for 8.3 percent of China’s total natural gas output, it said.

The project has incorporated sour gas processing technology from U.S. firm Black Veatch, industry experts say.

The technology has now been applied in Sinopec’s other high-sulphur natural gas fields, including Dawan, Yuanba and Xinglong in Sichuan and neighbouring Chongqing municipality.

Puguang gas field was discovered in 2003 and developed in 2006 as a major project to deliver gas from Sichuan to the booming east coast.

Sinopec has invested around 62 billion yuan ($10 billion) in the project, including in gas exploration, pipeline construction and a sour-gas purification plant, the paper said.

The plant can purify 12 bcm of sour natural gas annually and produce 2.1 million tonnes of sulphur for agricultural use, accounting for 45 percent of China’s total sulphur output, it said.

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