PetroChina has signed a gas sales contract with Chevron covering the US major’s output from the Chuandongbei sour gas field in south-western China’s Sichuan province.
The deal was signed in late November and will call for Chevron to sell its equity gas to PetroChina Southwest Oil & Gas. He declined to release the price formula, but the volumes covered by the deal are understood to start at about 1 billion cubic metres per year, rising to about 3 Bcm. “Along with PetroChina, Chevron continues to progress work on the Chuandongbei gas project following the signature of a 30-year production sharing contract with China National Petroleum Corporation that became effective in February 2008,” Chevron spokesman Kurt Glaubitz told Upstream. “We will not make any additional details available until we reach our final investment decision and after we have received final government approval to proceed with the project,” he added. Chevron is operator of the field with a 49% equity stake, while partner CNPC holds the 51% balance. PetroChina will market the gas to utilities, such as gas-based chemical plants, as well as fuel for iron and steel mills, Upstream was told. China-based industry officials said the field will likely start producing first gas by the end of next year.
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