China's national oil companies are responding quickly to the government's call for drastic cuts in greenhouse gas emissions to reach the ambitious climate targets set last year, including an aim to achieve carbon neutrality by 2060.
China National Petroleum Corporation (CNPC) vice president Jiao Fangzhen told a recent energy conference in Beijing that his company's low-carbon transition will focus more on the development of solar, wind and hydrogen energy while it continues to pursue natural gas exploration and production.
CNPC announced that it is aiming for net-zero carbon dioxide emission by 2050 as part of the state oil giant's green development strategy.
Offshore operator CNOOC Ltd has mapped out a three-pronged strategy for energy transition, said chief financial officer Xie Weizhi, noting that the company will first focus on increasing natural gas production so that gas accounts for 30% of its total energy output, up from 21% last year.
That effort involves bringing on stream a number of giant gas fields, including Lingshui 17-2 in the South China Sea's Qiongdongnan basin and the Bozhong 19-6 gas field in Bohai Bay.
The company will also increase activities to develop onshore unconventional gas, especially coalbed methane and shale gas.
The second green development stage will promote energy conservation and emissions reduction by using large pumps, waste heat recovery and associated gas recovery, and by tapping the onshore grid to supply power to offshore platforms.
One such pilot project in the Bohai Bay to supply electricity to the Caofeidian field will help cut CO2 emission by an estimated 170,000 tonnes per annum.
In the third initiative, CNOOC Ltd will increase its renewable energy footprint, with a focus on offshore wind projects.
The company has earmarked more than 5% of its annual budget for clean energy projects, equating to between 4.5 billion and 5 billion yuan (between $690 million and $700 million) from this year's capital expenditure budget of between 90 billion and 100 billion yuan.
The planned investment in new energy is higher than the 3% to 5% announced early last year.
Chief executive Xu Keqiang said the company will push forward with offshore wind projects "in a steady and cautious manner", adding that it will only raise investment in offshore wind projects if they show potential for returns.
CNOOC Ltd recently won governmental approval to develop a wind project offshore Shantou city in southern China’s Guangdong province, the second of its kind for the company.
CNOOC Ltd decided to return to the offshore wind sector early last year by incorporating a renewable-energy outfit, CNOOC Renewable Energy, in Shanghai.
The company started operations last September at its first offshore wind power project in Jiangsu province.
The H2 project has total power generation capacity of 300 megawatts, with 50 4MW units and 17 6MW units. Out of the total, 47 units are installed in shallow waters and the remainder in deep water.
CNOOC Ltd first started its clean-energy business in 2006 with CNOOC New Energy Investment, a business unit to oversee wind, solar and biomass projects.
The unit was shut down five years ago due to lacklustre demand. However, as demand grew, in late 2019 the company decided to revisit the sector as part of its corporate strategy.
CHINA'S ENERGY CONSUMPTION BY TYPE
*in billion tonnes of coal equivalent
Source: China Petroleum Economics & Technology Research Institute