China's oil and gas production has maintained a good momentum, and marine energy has become an important growth pole

Why has China's offshore oil and gas become the main force to increase production? What is the future of new marine energy sources? At the recent China Marine Energy Development Forum, experts at the meeting believed that marine energy will become an important driving force for social development, and offshore oil and gas production has become an indispensable energy growth pole.

China's oil and gas production has maintained a good momentum

The "China Marine Energy Development Report 2022" released at the meeting predicts that in 2022, the proportion of coal and oil in global primary energy consumption will increase by 0.3 percentage points, the proportion of natural gas will decrease by 0.6 percentage points, the proportion of non-fossil energy will be basically the same, and global energy-related carbon dioxide emissions will grow at a low rate to 34.9 billion tons.

The report predicts that in 2022, the proportion of coal in China's energy consumption structure will rebound slightly; The share of oil and natural gas decreased slightly, while the share of non-fossil energy increased to 17.2% from 16.6% in 2021.It is worth mentioning that this year, while the growth rate of overall domestic energy consumption has slowed down due to factors such as the epidemic and prices, and the demand for crude oil and natural gas has fallen slightly, domestic oil and gas production has maintained a good momentum, and China's dependence on crude oil and natural gas is expected to decline. The report predicts that domestic crude oil production will reach about 205 million tons in 2022, exceeding 200 million tons for the first time since 2016, and China's natural gas production is expected to reach 221.1 billion cubic meters, a year-on-year increase of 6.5%.

"The development of marine energy will become a key increment in the coordination of energy security and transition." Ren Jingdong, deputy director of the National Energy Administration, said that in the past decade, the number of offshore oil and gas discoveries and recoverable reserves accounted for more than 80% of the world's large-scale oil and gas field discoveries, and the global marine gas hydrate resources were about 42 times the recoverable resources of conventional natural gas.He said that in the medium and long term, offshore oil and gas resources, especially deep-water oil and gas resources, will become an important resource replacement area, which will effectively guarantee China's oil and gas security. At the same time, in the process of accelerating the adjustment of energy structure, marine renewable energy will become an important path based on China's resource endowment and actively and steadily promoting carbon peak and carbon neutrality.

Offshore oil and gas investment has grown substantially

Wang Zhen, president of the Energy Economics Research Institute of CNOOC Group, said that this year, affected by the sharp rise in oil and gas prices, global offshore oil and gas investment has increased significantly. According to the report, the global investment in offshore oil and gas exploration and development is expected to reach 167.28 billion US dollars this year, a year-on-year increase of 21.3%, accounting for 33.2% of the total oil and gas investment. Investment in deepwater and ultra-deepwater has grown significantly, with Asia and the Middle East being the regions with the highest investment, with China performing very well. In 2022, nearly 40% of the global offshore drilling effort came from Chinese waters.

This year is also a year of major breakthroughs in China's offshore oil and gas exploration and development. According to the report, in 2022, China Offshore Oil and Gas has made 7 new exploration discoveries, successfully evaluated 20 oil and gas structures such as Baodao 21-1, and plans to put into operation 7 new production capacity projects this year. The report estimates that China's offshore oil production will reach 58.62 million tons in 2022, a year-on-year increase of 6.9%, accounting for more than half of the country's oil production. Among them, the Bohai Sea and the eastern part of the South China Sea are the main areas of offshore oil production, with offshore natural gas production reaching 21.6 billion cubic meters, a year-on-year increase of 8.6%, accounting for about 13% of the country's natural gas production increase.Wang Dongjin, chairman of China National Offshore Oil Corporation, said that the proven rate and utilization rate of China's offshore oil and gas resources are far lower than those on land, and the development potential is huge. In recent years, CNOOC Limited has implemented a seven-year action plan to "increase reserves and production", and in the past three years, domestic crude oil production has accounted for more than 70% of the country's total increase.

The report expects a steady increase in offshore oil production in 2023. Global offshore oil production is expected to grow to 28.8 million barrels per day, surpassing pre-pandemic levels. From the perspective of water depth, the production of the whole water area will increase, and the water depth of 0 to 300 meters and 1501 to 3000 meters will increase the most. At the same time, global marine natural gas production will also accelerate. With the full recovery of the global natural gas market, global marine natural gas production is expected to reach 1,186.5 billion cubic meters, a year-on-year increase of 2.6%.The report also predicts that global investment in offshore oil and gas exploration and development will continue to increase in 2023. Global investment in offshore oil and gas exploration and development is expected to increase slightly to US$177.44 billion, a year-on-year increase of about 6.1%, accounting for 32% of the total investment in global oil and gas exploration and development.

New marine energy sources are gaining traction

Ren Jingdong said that the new energy system is an important material foundation for realizing Chinese-style modernization. It is necessary to focus on marine energy, establish and improve the marine industry system, organically integrate the new energy system into the transformation of the whole industrial chain, cultivate new momentum for economic development, and serve the sustainable development of the economy and society.Among them, offshore wind energy is becoming an important support. The report predicts that by the end of 2022, the global installed capacity of offshore wind power connected to the grid will reach 68.5 million kilowatts, a year-on-year increase of 26%, accounting for about 2% of the total installed renewable energy generation capacity in the world, and this proportion will increase steadily in the future.

According to the report, by the end of 2022, China's cumulative grid-connected offshore wind power capacity is expected to reach 32.5 million kilowatts, accounting for almost half of the world's total. The domestic offshore wind power industry is characterized by agglomeration and development, and industrial clusters such as the Bohai Rim, the Yangtze River Delta, and the Pearl River Delta have been initially formed.It is understood that at present, China has built or is building 28 offshore wind power industrial parks and industrial bases. Machine manufacturers are also laying out in many places to strive for the market, and there is a surplus of complete machines in some markets.

The report predicts that in China's process of promoting large-scale, high-proportion, market-oriented and high-quality development of renewable energy, the proportion of offshore wind power generation in coastal provinces is expected to increase from the current 2% to nearly 20% by 2050.At the same time, China is also constantly exploring the development of offshore photovoltaics. Shandong Province issued the Action Plan for Offshore Photovoltaic Construction Projects in Shandong Province, and proposed the layout of two offshore photovoltaic bases around the Bohai Sea and along the Yellow Sea.From the perspective of marine hydrogen energy, the International Energy Agency predicts that the global installed capacity of hydrogen production from water electrolysis may reach 1.4 million kilowatts by the end of 2022, and may grow to more than 100 million kilowatts by 2030, with considerable development potential. China has also incorporated offshore wind power hydrogen production technology and offshore energy island construction into its energy planning.From the perspective of marine biomass energy, China's marine microalgae biomass resource endowment is relatively good, but the development progress is relatively slow, and it is subject to commerciality, especially technology, and the future development still needs a great breakthrough.

Xie Yuhong, academician of the Chinese Academy of Engineering, said that accelerating the construction of a new energy system is the only way to promote China's energy upgrading. It is necessary to give full play to the advantages of the ocean, strengthen the concept of marine energy, and promote the integrated development of the entire industrial chain of the marine economy.He suggested that it is necessary to fully explore the marine environment, marine geology, ocean depth, and data information, maximize data utilization, replace the single oilfield thinking with the concept of basin energy, and cover the utilization of a single marine oil and gas energy with marine energy applications.

An Fengquan, senior adviser to the head of the International Energy Agency, said that there are many types of energy in the world, but the amount of resources, quality, technology maturity, development scale, and development and operating costs vary greatly. At present, the relatively mature offshore oil and gas accounts for a quarter of the world's total production, and about 7% of the world's nearly 900 million kilowatts of wind power installed capacity is offshore wind power. But at the same time, tidal and wave energy is much lower than offshore wind energy.He said that countries need to formulate strategic plans and related policies, clarify marine energy development goals, key roadmaps and timetables, and provide stable policy guidance and investment orientation to promote marine energy development.

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