Total, Petrochina Created JV for Gas Field Development

French oil giant Total SA yesterday said it wants to pump 11.33 million cubic metres of natural gas a day from a joint-developed gas field in Northwest China in at least two and a half years.

Total yesterday signed a deal with the nation's biggest oil producer PetroChina to jointly develop the South Sulige Block in the gas-rich region of Ordos Basin.

The two sides will soon start the evaluation phase of the field, which will last at least 30 months, said Denis Palluat de Besset, general manager of Total Kuwait, who is about to be named general manager of the company's China operations.

The full-field development of the South Sulige block, which boasts gas reserves of more than 100 billion cubic metres, will pump about 11.33 million cubic metres of gas per day.

The Total manager added the production would occur only after the evaluation phase, or in two and a half years. Besset said both Total and PetroChina would invest at least US$20 million into the evaluation phase of the project. He said it was still too early to give "reasonable figures" concerning the cost and economic returns of the field production once it is in operation.

Both sides said they have not decided on the share structure of the project.

PetroChina President Jiang Jiemin said the project is another successful co-operation with foreign investors to develop the inland upstream reserves in China, and West-East Gas Pipeline's easy access will ensure good market prospects for the South Sulige project.