At the opening ceremony of the 2023 Zhongguancun Forum, held just recently, ten major scientific and technological achievements were unveiled, including a next-generation 256-core blockchain-specific acceleration chip and a new-generation quantum computing cloud platform. Among these, the “revolutionary breakthrough in continental shale oil technology and strategic advancement” was highlighted as a key achievement representing significant progress in the oil and gas industry.
　　The Zhongguancun Forum is jointly hosted by the Ministry of Science and Technology, the National Development and Reform Commission, the Ministry of Industry and Information Technology, the State-owned Assets Supervision and Administration Commission of the State Council, the Chinese Academy of Sciences, the Chinese Academy of Engineering, the China Association for Science and Technology, and the Beijing Municipal Government. The scientific and technological achievements selected at the forum carry significant weight and high value.
　　The achievement “Technological Revolution and Strategic Breakthrough in Continental Shale Oil” has innovated China’s geological theory on the enrichment of continental shale oil, resolving the global scientific challenges related to “oil generation,” “oil storage,” and “oil production” in continental shale formations. It has also established a key technological system for China’s continental shale oil and generated a number of independently owned intellectual property rights. Furthermore, it has led to the construction of national-level demonstration zones and bases in regions including Longdong in the Ordos Basin, Jimusar in the Junggar Basin, and Gulong in the Songliao Basin.
　　Professor Yang Zhi, Deputy Director of the Tight Oil Research Institute at the China National Petroleum Corporation’s Research Institute for Exploration and Development, and Project Leader of the “14th Five-Year Plan” Forward-Looking and Fundamental Major Science and Technology Project on Shale Oil at CNPC, explained that conventional oil reservoirs have relatively large pore sizes in the rock—on the order of millimeters or even centimeters. However, today’s continental shale oil is akin to extracting oil from shale particles with pore sizes measuring around 70 micrometers, roughly the diameter of a human hair. These pores are now on the micrometer and nanometer scales, making exploration and development extremely challenging.
　　China’s continental shale oil has four “shortcomings”: First, the oil is relatively heavy, making it difficult to flow; second, the sweet spots are relatively small, increasing the difficulty of prediction; third, the clay content is high, making hydraulic fracturing challenging; and fourth, the continuous distribution is uneven, further complicating operations.
　　From an exploration perspective, drilling to accurately identify thin, highly concentrated reservoir layers—measuring just a few to a dozen meters—in the subsurface at depths of several kilometers can achieve remarkably high prediction accuracy. After extremely challenging exploration efforts, we’ve now managed to achieve a favorable reservoir encounter rate exceeding 90%. From a development standpoint, conventional oil fields typically involve drilling a straight well, where, under natural pressure conditions, the oil can naturally flow through the wellbore and reach the surface on its own. However, shale oil lacks these natural flow conditions and thus requires human intervention—breaking up the tight shale rock to create the necessary flow pathways.
　　Despite the high extraction difficulty and costs, why do we still pursue shale oil production? In response, Professor Yang Zhi pointed out that for a long time, our country has been characterized by oil scarcity, making every drop of petroleum resource extremely precious. Although we have now achieved self-sufficiency in oil, to ensure energy security, we must continue to rely on technological independence and innovation to explore and develop new oil sources. Shale oil from continental strata represents a strategic reserve of petroleum resources, and its large-scale, cost-effective development holds significant strategic importance. Over the past decade, continental shale oil production has grown from nothing to substantial levels; by 2022, China’s output of continental shale oil in petroleum licensing areas had already exceeded 3 million tons.
　　02. Solving Three World-Class Challenges in Continental Shale Oil
　　Over the past decade, China National Petroleum Corporation has experienced a series of landmark milestones in the shale oil sector, including the discovery of nanopores, participation in the national 973 R&D program, establishment of national laboratories, conducting international collaborative research, deploying exploration risk wells, launching pilot development projects, and building national demonstration zones. As a result, the company has achieved a revolutionary innovation in “shale oil production from continental strata” and developed a distinctive set of theoretical and technological approaches.
　　Professor Yang Zhi introduced that, on the one hand, they have innovated China's geological theory on the enrichment of continental shale oil, thereby solving three major global scientific challenges related to continental shale—namely, "oil generation," "oil storage," and "oil production." Specifically, they have established a sedimentary model for organic-rich continental shale; discovered a nanoscale pore-throat system in shale capable of storing oil; and elucidated the enrichment patterns of "continuous-type" sweet spots and sweet spot segments in shale oil.
　　On the other hand, four key technological systems have been established for China’s continental shale oil—experimental research, exploration and evaluation, development engineering, and advanced innovation—resulting in a number of independently owned intellectual property rights. Among these, the intelligent digital rock evaluation technology has achieved integration across nine orders of magnitude, from meters down to nanometers. At the same time, a series of shale oil development engineering technologies has been developed, encompassing eight core technologies, including volumetric development and large-platform/well-factory development. In addition, efforts have been launched to tackle the challenge of in-situ conversion of medium- and low-maturity shale oil. These efforts have essentially resolved key technical challenges such as resource evaluation and target-area selection, and have led to the development of a number of achievements with independent intellectual property rights, including three national standards and 35 trade secrets.
　　03. Continental shale oil ushers in a new round of the “oil revolution”
　　Innovations in theoretical and technological approaches have spearheaded and driven China’s continental shale oil sector toward strategic breakthroughs in three key areas. First, a series of major exploration discoveries have been made in basins including Ordos, Junggar, Songliao, Bohai Bay, Sichuan, and Qaidam. Second, national-level demonstration zones and bases have been established in Longdong, Jimusar, and Gulong. The Ordos Basin in central China has become the country’s largest fully integrated shale oil field to date; the Jimusar area in the western Junggar Basin is China’s first national-level demonstration zone for continental shale oil; and the Daqing Gulong continental shale oil demonstration zone in eastern China has already achieved significant breakthroughs of strategic importance. Third, driven by innovative achievements, continental shale oil has emerged as a national strategic resource.
　　Moreover, after shale oil is extracted, it is essential to keep costs as low as possible under market conditions and achieve economies of scale in development. According to public reports, the Cangdong Depression No. 5 Platform—a demonstration platform for efficient shale oil development under China National Petroleum Corporation’s Dagang Oilfield Company—has officially begun production. The platform houses a total of nine shale oil wells, with a stable daily production capacity of around 280 tons, yielding an annual production capacity of 100,000 tons. This marks the official completion and commissioning of China’s first demonstration platform for efficient shale oil development at the 100,000-ton level in the Dagang Oilfield. According to estimates, the four wells deployed earlier on the platform collectively produced over 40 tons of oil per day. With the addition of five newly drilled wells, the platform’s output has further increased, with each new well now producing steadily between 40 and 50 tons of oil per day. It is projected that each of these new wells could yield over 10,000 tons of oil in its first year of production, and their ultimate recovery rates could reach as high as 41,000 tons per well, thus realizing efficient development of continental shale oil.
　　Professor Yang Zhi said that the Cangdong Platform is one of the success stories. The Changqing Oilfield has taken the lead in building China’s first fully integrated oilfield with a production capacity of over one million tons on the Loess Plateau, and its shale oil output ranks first in the country; last year, its production exceeded 2 million tons. In Jimusar Gobi, Xinjiang Oilfield is currently constructing the nation’s first national-level shale oil demonstration zone, and last year its output surpassed 500,000 tons. Another shale oil project that has attracted widespread attention is the Gulong shale oil field in Daqing Oilfield, which, relatively speaking, is more challenging to develop; last year, its output also exceeded 100,000 tons of oil equivalent.
　　It’s not hard to see that China National Petroleum Corporation’s theoretical and technological innovations—and practical achievements—in onshore shale oil have broken through “theoretical misconceptions,” shattered “exploration taboos,” and conquered “development frontiers.” They’ve found the “golden key” to extracting oil from shale, and are now sparking a new “oil revolution.”