On Thursday, China Petroleum & Chemical Corp. (Sinopec) announced plans to increase its natural gas output in 2020.
The increase would by 1.1% year-on-year to more than 30 bcm of natural gas. This increase is expected to help the company offset some of the losses it obtained due to paying higher prices for gas imports than the current market value.
In the first nine months of 2020, the company produced a total of 21.87 bcm of natural gas, down by 0.2% year-on-year. Sinopec did not reveal the reason behind the slowing output growth.
The company just said that there were decreases in its investments in natural gas production capacity and development costs. Therefore, recently, Sinopec announced the additional 83 bcm of the newly proven natural gas reserve at the Chuanxi field. It also added around 192 bcm of the certified new reserve at its shale gas project Fuling in the Sichuan basin in southwestern China.
In the period, the company had also spurred the spot purchases of liquefied natural gas (LNG) at low prices, which helped mitigate the losses on its gas imports business.
Looking ahead, Sinopec has set a goal to increase the percentage of natural gas in its energy production portfolio to more than 50% in 2023 from 41% last year. Its gas output capacity in the year would reach 40 bcmpa in 2023.
