The Research Institute of Petroleum Exploration & Development (RIPED) of the China National Petroleum Corporation (CNPC) offers unique insights that enrich the global energy dialogue with Chinese perspectives on global energy trade, investment trends, and their impacts on global energy security. Dr Sun Xiansheng, IEF Secretary General, welcomed Dr Mu Longxin, Vice President of RIPED, to present the Institute’s views on global oil and gas market developments along with oil and gas exploration and development initiatives.
Dr Mu Longxin highlighted that the Americas region has yielded the greatest production increase with more than 8 percent growth in oil and gas equivalent by the end of 2018. Unconventional oil and gas production grew by almost 6 percent outpacing growth in both onshore and offshore conventional supply. Conventional oil production grew by almost 3 percent in 2018, the fastest in the past decade with notable increases coming from the US, Canada, Brazil, Iraq, and Saudi Arabia. Overall, natural gas production is growing faster than oil given the rise of new LNG technologies and unconventional drilling techniques. According to the Institute’s assessments, US tight oil production will peak around 2025; a view that is shared by other major outlooks.
Dr Hon Yongke, Director, Department of Research Management of RIPED outlined that oil and gas investment has generally declined compared to the mid-2000s but noted a rise in growth of about 2 percent in 2018. Although oil and gas sector investment has slowly trended upwards since 2016, it is far from the levels observed before the 2014 market shift, which will impact energy security in future. Lower levels of investment combined with growing geopolitical uncertainties can increase energy market volatility when sustained over an extended period.
While overall exploration activity decreased, the number of drilled wells increased dramatically since last year with close to 1700 wells drilled representing almost 15 percent growth in 2018. Newly added reserves were primarily on account of 20 large- and medium-scale oil and gas fields that are currently in production, of which 85 percent are situated in middle-shallow reservoirs. In terms of new discoveries, projects in the Eastern Mediterranean, Guyana, Russia, Norway, and Australia will add to global energy supply.
In the long-term, offshore production will dominate global exploration priorities along with strengthening independent exploration while increasing investment in science and technology. Through its devoted efforts in the past 50 years, RIPED has made an important contribution to the progress of petroleum technology and development of the Chinese petroleum industry. For more information, please see the key link and presentations below.