Heavy Oils in China
Heavy oil is an important energy source with huge potential, and its exploitation and utilization are important in our countrys energy security strategy. There is much potential to increase the utilization of heavy oil in China, especially with the development of refining and technological processes in the energy sector.
Heavy oil is a kind of crude oil with relatively high density and viscosity, and it is difficult to exploit and transport compared to light oil. It can includes both traditional crude oils with a density lower than 20° API, as well as tar sands, shale oils and tight heavy oils, which have densities lower than 12° API. In China, heavy oil is widely distributed in offshore and onshore areas, making it an important energy source for our country.
At present, Chinas heavy oil exploitation and utilization is relatively backward. Most of the heavy oil exploitation activities in China are still onshore traditional oilfields, and the development of offshore heavy oil reservoirs has just begun. The main problem of heavy oil exploitation is the lack of advanced technologies and techniques. Traditional techniques used in light oil exploitation are not suitable for exploitation of heavy oil, and exploitation techniques of ultra-heavy oil with API gravity lower than 12° are even more limited.
The development of heavy oil technologies has lagged behind in China, especially the development of advanced techniques used in other countries such as the US and Canada. China’s exploration and production of heavy oil has relied heavily on traditional techniques like thermal techniques and conventional drilling, which are rather limited in terms of recovery rate and reserves.
To enhance the utilization of heavy oil in China and improve the energy security level of our country, the government has set up a number of technical conditions for the development of heavy oil, including promote application of advance production techniques like steam drive, and enhanced oil recovery technologies like chemical flooding.
The government has also made significant progress in establishing favorable policies for the exploitation and utilization of heavy oil resources. It has established subsidies for research and development, as well as encouraged integration of upstream and downstream companies in the heavy oil industry in order to promote the development of heavy oil exploitation and utilization technologies. The subsidies enhances productions costs and technical thresholds, as well as encourages oil companies and research institutes to produce advanced technologies and equipment for the exploitation and utilization of heavy oil.
The government has also made efforts in regulating the heavy oil market, and it has introduced standards and regulations on the evaluation criteria for heavy oil, as well as special policies for the pricing and taxation of heavy oil. The government has further increased the integration of research and enterprises on the production and utilization of heavy oil, and encouraged the active participation of capital in the industry.
All these efforts have created an environment and condition that help promote the research, formation and utilization of heavy oil technologies. There is still a large gap between the current level of heavy oil technologies in China and the level in other countries, however, it is expected that the level of heavy oil technology in China will be further enhanced with the governments continued efforts in providing support to the sector.
