CNOOC reports first deepwater gas discovery in South China Sea

China's largest producer of offshore oil and gas CNOOC said Monday that CNOOC 981, the country's first deepwater drilling rig, has made its first deepwater gasfield discovery in the South China Sea.
The Lingshui 17-2 gasfield, some 150 kilometers south of Hainan Island, is in the east Lingshui Sag of the Qiongdongnan Basin, the company said in a statement.
It is an ultradeepwater gasfield at an average operational water depth of 1,500 meters.
The definition of deepwater varies as technology develops. Currently, deepwater refers to anything below 500 meters, while depths over 1,500 meters are termed ultradeepwater.
Xie Yuhong, a manager with CNOOC, said the well would produce 56.5 million cubic feet of gas per day, equivalent to about 9,400 barrels of liquid oil per day, the highest daily flow of all CNOOC's gas wells during testing.
The discovery needs to be confirmed by the resources reserve authority and, until then, the exact exploitable reserves cannot be reported.
According to Xie, the gasfield could be very large, given test results so far. A large gasfield generally means at least 30 billion cubic meters.
Wang Yilin, CNOOC chairman, said discovery of the field opened the door to deepwater oil and gas resources in the South China Sea and the huge exploration potential of deepwater areas there.
Lingshui 17-2 is the first significant deepwater discovery by semi-submersible rig CNOOC 981, which has been operating in the South China Sea since May, 2012. The rig cost 6 billion yuan (975 million U.S. dollars) and took more than three years to build. With a deck the size of a standard football field, the rig can operate at a depth of 3,000 meters and can drill as deep as 12,000 meters.
China is the world's biggest energy consumer and heavily dependent on imported oil and natural gas with 58 percent and 31.6 percent respectively imported in 2013.
In desperate need of fuel, China has been working hard to find new sources at home.