OREANDA-NEWS. August 31, 2012. Shale gas output at China Petrochemical Corp.’s (Sinopec Group) Fushi-1 shale well in Chongqing Municipality reached a record 126 thousand cubic meters per day (Mcm/d), the country’s second largest energy producer announced.

The output is from the Daanzhai formation lying at a depth of 2,000 to 3,000 meters, Deng Zhanghua, an engineer with Sinopec Exploration Southern Co., told.

Sinopec Group has already obtained shale gas flows from Fushi-1. Output from the Maokou and Feixianguan formations have reached 67 Mcm/d and 52 Mcm/d, respectively, according to the announcement. Maokou and Feixianguan are significantly deeper than Daanzhai, Deng said.

Chongqing in southwest China is one of the country’s most promising shale gas areas. Shale gas output from the sprawling municipality of 30 million people is expected to reach 1.3 to 1.5 billion cubic meters per year (bcm/y) by 2015, which would represent at least one-fifth of a 6.5 bcm/y target set by Beijing for 2015.

Exploration in the municipality has concentrated on the Lower Silurian Longmaxi formation in the southeast, where two shale gas blocks - Nanchuan and Xiushan - were auctioned to Sinopec Group and Henan Provincial Coal Seam Gas Development & Utilization Co., respectively, last year.

Fushi-1 is located in the Fuling Daanzhai demonstration project in northern Chongqing’s Liangping County, which is Sinopec Group’s first shale production demonstration project. Liangping is among eight counties and districts officially identified as a favorable area for shale gas development in Chongqing.

Sinopec Exploration Southern is responsible for the project’s exploratory work, while Sinopec Jianghan Oilfield Co. handles production and output. Furthermore, Exploration Southern is working on six exploration wells in the demonstration area and will build some “small” production capacity this year, Deng said.

Exploration Southern intends to build 300 to 500 million cubic meters (MMcm) of shale gas production capacity in Fuling Daanzhai by the end of this year, Sinopec Group said in its announcement.

Exploration Southern has finished drilling five test wells and completed testing of four wells, three of which have obtained industrial flows.