On October 19, 2021, Zhongman Petroleum & Natural Group Corp., Ltd. (ZPEC) received the “Oil and Gas Mining License in Wenbei Block, Tarim Basin, Xinjiang Province” issued by the Ministry of Natural Resources, becoming the first domestic private enterprise to obtain the conventional oil and gas block mining license after the country implemented the reform of the oil and gas system. It significantly enhanced the company's sustainable development capabilities and core competitiveness.
The mining license obtained has a validity period of 20 years, involving a mining area of 43.297 square kilometers. ZPEC obtained the reserve approval issued by the Ministry of Natural Resources on September 9, 2020. The block has a proven geological reserve of 30.11 million tons of crude oil, a proven geological reserve of 304 million cubic meters of dissolved gas, and a proven geological reserve of 449 million cubic meters of natural gas, with characteristics of burial shallowness, abundant reserves, and easy mining. Up to now, the company has drilled 66 wells in this block, all of which have obtained industrial oil flow, demonstrating good prospects for exploration and development. After upgrading from prospecting rights to mining rights, ZPEC can complete the oilfield production capacity construction faster, better, and more efficiently in the Wenbei Block, thus increasing production scale and laying a solid foundation for the company's sound development and performance growth. At the same time, it will also help the company to further scientifically plan the subsequent exploration and development of the remaining 709 square kilometer block.
Since 2015, the Central Committee of the Communist Party of China, the State Council, the National Development and Reform Commission, and other leading departments have repeatedly put forward requirements and opinions on the reform of China's oil and gas industry and supported private enterprises in entering various fields such as oil and gas exploration and development. Seizing this favorable opportunity, ZPEC, an internationally renowned privately-owned listed company, relies on the advantages of the integration of drilling engineering and equipment manufacturing to actively transform to the upstream of oil and gas exploration and development. In January 2018, it won the bid for the 1086.26 square kilometer Wensu Block in Xinjiang for USD133.36 M (RMB 866.87 M) through an open bidding method, which was actively integrated into the country's energy development strategy.
With the strong support and help of the national authorities at all levels, the company adopts the oil company operating model and gives full play to the flexible advantages of private enterprise mechanisms and the cost, technology, and synergy advantages of group operation. Great progress has been made in oil and gas exploration, and ZPEC has become a pilot and successful model for China's oil and gas industry reform led by the Ministry of Natural Resources. Up to now, it has successively set a number of new records in the Wensu Block, namely: the first domestic private enterprise to obtain Oil and Natural Gas Prospecting Rights through listing, the first domestic private enterprise to gain the Report On New Proven Reserves of Conventional Oil and Natural Gas Review and Record, the first domestic private enterprise to obtain the Approval of the Environmental Impact Report of Oil and Gas Blocks, and the first domestic private enterprise to obtain an Oil and Gas Mining License.
The overall exploration and development work of the ZPEC’s Wensu Block is fast-paced, efficient, and results-rich, which fully embodies the characteristics of grasping opportunities, being proactive, and daring to win. It successfully discovered the Wenbei Oilfield, Hongqipo Oilfield, and Saike Oilfield within 377 square kilometers of the completed 3D seismic acquisition. Recently, oil and gas exploration in the remaining two-thirds of the mining area has also achieved gratifying results. Benefited from the company's integrated advantages in the three major business areas of exploration and development, drilling and completion engineering, and petroleum equipment manufacturing, ZPEC has made these achievements.
Since 2018, the Mining Rights Department of the Ministry of Natural Resources, the Oil and Gas Resources Investigation Center, the Xinjiang Natural Resources Department, and the leaders of Aksu Prefecture have visited the Wensu Block many times for investigations. They have given high praise on ZPEC’s achievements of "A breakthrough in one year, construction and production in two years, and put into production in three years", while encouraging the company to explore in depth and strive to become a benchmark and banner for private enterprises to participate in the national oil and gas resource reform.
(Mrs. Yang Hongmin)
