China is targeting another increase in domestic crude production for 2020, despite state-controlled energy firms cutting their upstream investment plans after oil prices slumped earlier this year. Producers should target crude output of 193 million tonnes in 2020, the national energy administration (NEA) said. That would be up by 1.6 percent from actual production in 2019.
China's domestic oil and gas production is dominated by the three big state-controlled firms, PetroChina, Sinopec and CNOOC. The companies have been working to increase upstream reserves and production under a seven-year action plan designed to strengthen China's energy security that was announced by the government in 2018.
The plan helped reverse a three-year decline in domestic output last year. Crude production in 2019 was 3.8 million b/d, up by less than 1 percent from a year earlier and still well below the peak of 4.3 million b/d in 2015. Domestic upstream investment surged by 21.9 percent from 2018 to 332.1 billion yuan ($47 billion) last year.
PetroChina in late April cut its capital expenditure (capex) plans for 2020 by nearly a third from its original target, to about Yn200 billion yuan. The cuts followed the company's first quarterly loss since 2016. The upstream sector accounts for over 75 percent of PetroChina's total capex. The company is cutting back its oil field engineering activity.
