China’s Sinopec has a remarkable increase in oil production at its Jiyang shale field, boosting output from 100 tons per day in 2021 to 1,600 tons per day in 2024. This surge equates to an impressive daily production rate of approximately 11,700 barrels, given that one metric ton of crude oil is roughly equivalent to 733 barrels.
Sinopec anticipates achieving an annual cumulative production target of half a million tons at the Jiyang field by next year, marking a significant milestone in its shale production efforts.
Earlier this year, Sinopec announced a new oil and gas discovery at another shale deposit in the Sichuan province, estimating that initial flows could potentially yield around 100 million metric tons of hydrocarbons. This discovery highlights China’s vast shale resources, particularly in natural gas, although extraction remains a challenge due to the complex geology of local shale formations, which differs from the more easily accessible resources found in the United States.
The Jiyang field, located in Shandong province—home to many of China’s independent refiners—plays a crucial role in the country’s strategy to enhance domestic oil and gas production. This initiative aims to reduce China’s significant reliance on foreign hydrocarbon resources. The Jiyang field is part of the larger Shengli conventional deposit, which has been operational for decades, with estimated reserves of around 10.5 billion tons, including 1.73 billion tons classified as prospective reserves.
China’s efforts to boost domestic hydrocarbon production are showing positive results. In 2023, the Chinese energy sector achieved record highs in both oil and gas output. The country produced approximately 4.2 million barrels of crude oil per day, totaling 208 million tons for the year—an increase of 3 million tons compared to 2022. Additionally, natural gas production reached 230 billion cubic meters, with 96 billion cubic meters sourced from unconventional resources, including shale, coalbed methane, and natural gas hydrates.
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