CPC signs seven-year deep-water exploration contract

By Helen Ku  /  Staff reporter

Thu, Dec 20, 2012 - Page 14

State-run CPC Corp, Taiwan (CPC, 中油) yesterday said it has achieved success in its No. 4 well at Guantian Township (官田), Greater Tainan.

The latest success represents yet another onshore discovery at natural gas wells in Guantian, which CPC began drilling a decade ago.

CPC said it is now in the process of conducting oil and gas tests at the well. Once the tests are finished, about 86 million cubic meters of natural gas will be available for sale, the company said.

Besides onshore drilling, the company has collaborated with China, Australia, Chad, Indonesia, Libya and the US in overseas oil and gas exploration.

On Tuesday, CPC signed a seven-year contract with Husky Energy Inc on searching for natural gas in deep waters in the Taiwan Strait. The Canadian company is known for its deep-water drilling, high-tech equipment and experience.

CPC vice president Chen Ming-hui (陳明輝) said the contract had been under negotiation for more than three years, and that CPC had begun gas exploration yesterday in the South China Sea.

“Considering that Taiwan lacks natural resources and that more than 95 percent of our energy resources are imported from other countries, we decided to increase our output in collaboration with Husky to be less import-reliant,” Chen said by telephone.

Signed by Wu Jung-chang (吳榮章), president of CPC, and Robert M Hinkel, chief operating officer of Husky Energy for Asia Pacific, the two companies will conduct deep-water offshore mining in the Taiwan Strait.

CPC said the project will be carried out in three phases with a total investment of NT$2 billion (US$70 million). CPC has a 25 percent share in the project and Husky has 75 percent.

If more deposits for commercial use are detected in the future, CPC has the right to increase its stake to 50 percent Chen said.

CPC said it expects the two companies can explore oil and gas potential in the deep-water mining area off the southwestern coast in the Taiwan Strait.