Development,challenges and strategies of natural gas industry under carbon neutral target in China

In the mid-21st century,natural gas will enter its golden age,and the era of natural gas is arriving.This paper reviews the development stages of global natural gas industry and the enlightenment of American shale gas revolution,summarizes the development history and achievements of the natural gas industry in China,analyzes the status and challenges of natural gas in the green and low-carbon energy transition,and puts forward the natural gas industry development strategies under carbon neutral target in China.The natural gas industry in China has experienced three periods:start,growth,and leap forward.At present,China has become the fourth largest natural gas producer and third largest natural gas consumer in the world,and has made great achievements in natural gas exploration and development theory and technology,providing important support for the growth of production and reserves.China has set its goal of carbon neutrality to promote green and sustainable development,which brings opportunities and challenges for natural gas industry.Natural gas has significant low-carbon advantages,and gas-electric peak shaving boosts new energy development;the difficulty and cost of development are more prominent.For the national energy security and harmonious development between economy and ecology under the carbon neutral goal,based on the principle of"comprehensive planning,technological innovation,multi-energy complementarity,diversified integration,flexibility and efficiency,optimization and upgrading",the construction of the production-supplystorage-marketing system has to be improved so as to boost the development of the natural gas industry.First,it is necessary to strengthen efforts in the exploration and development of natural gas,making projects and arrangement in key exploration and development areas,meanwhile,it is urgent to make breakthroughs in key science theories and technologies,so as to increase reserve and production.Second,it should promote green and innovative development of the natural gas by developing new techniques,expanding new fields and integrating with new energy.Third,there is a demand to realize transformation and upgrading of the supply and demand structure of natural gas by strengthening the layout of pipeline gas,liquefied natural gas and the construction of underground gas storage,establishing reserve system for improving abilities of emergency response and adjustment,raising the proportion of natural gas in the primary energy consumption and contributing to the transformation of energy consumption structure,realizing low-carbon resources utilization and clean energy consumption.

Discussion on Natural Gas＇s Key Role in China＇s Energy-mix Transition

The evolution history of energy utilization around the world shows that a clean and low-carbon utilization of energy is the inevitable approach for dealing with climate change and for constructing a harmonious ecosystem.This paper focuses on the strategy options in China's energy-mix transition period based on an analysis of the global energy development trend.It is proved that using clean energy forms is critical to the realization of an energy transition in the country.As a result,natural gas is a practical choice,and structural reforms may help to bring its potential into full play.

Forecast of natural gas supply and demand in China under the background of “Dual Carbon Targets”

As a kind of clean energy which creates little carbon dioxide, natural gas will play a key role in the process of achieving “Peak Carbon Dioxide Emission” and “Carbon Neutrality”. The Long-range Energy Alternatives Planning System(LEAP) model was improved by using new parameters including comprehensive energy efficiency and terminal effective energy consumption. The Back Propagation(BP) Neural Network–LEAP model was proposed to predict key data such as total primary energy consumption, energy mix, carbon emissions from energy consumption, and natural gas consumption in China. Moreover, natural gas production in China was forecasted by the production composition method. Finally, based on the forecast results of natural gas supply and demand, suggestions were put forward on the development of China’s natural gas industry under the background of “Dual Carbon Targets”. The research results indicate that under the background of carbon peak and carbon neutrality, China’s primary energy consumption will peak(59.4×10^(8)tce) around 2035, carbon emissions from energy consumption will peak(103.4×10^(8)t) by 2025, and natural gas consumption will peak(6100×10^(8)m^(3)) around 2040, of which the largest increase will be contributed by the power sector and industrial sector. China’s peak natural gas production is about(2800–3400)×10^(8)m^(3), including(2100–2300)×10^(8)m^(3)conventional gas(including tight gas),(600–1050)×10^(8)m^(3)shale gas, and(150–220)×10^(8)m^(3)coalbed methane. Under the background of carbon peak and carbon neutrality, the natural gas consumption and production of China will further increase, showing a great potential of the natural gas industry.

Application of the monitoring and early warning system for internal solitary waves:Take the second natural gas hydrates production test in the South China Sea as an example

Internal solitary waves(ISWs) contain great energy and have the characteristics of emergency and concealment. To avoid their damage to offshore engineering, a new generation of monitoring and early warning system for ISWs was developed using technologies of double buoys monitoring, intelligent realtime data transmission, and automatic software identification. The system was applied to the second natural gas hydrates(NGHs) production test in the Shenhu Area, South China Sea(SCS) and successfully provided the early warning of ISWs for 173 days(from October 2019 to April 2020). The abrupt changes in the thrust force of the drilling platform under the attack of ISWs were consistent with the early warning information, proving the reliability of this system. A total of 93 ISWs were detected around the drilling platform. Most of them occurred during the spring tides in October–December 2019 and April 2020, while few of them occurred in winter. As suggested by the theoretical model, the full-depth structure of ISWs was a typical current profile of mode-1, and the velocities of wave-induced currents can reach 80 cm/s and30 cm/s, respectively, in the upper ocean and near the seabed. The ISWs may be primarily generated from the interactions between the topography and semidiurnal tides in the Luzon Strait, and then propagate westward to the drilling platform. This study could serve as an important reference for the early warning of ISWs for offshore engineering construction in the future.

Comparison of two schemes for district cooling system utilizing cold energy of liquefied natural gas

Two schemes（scheme Ⅰ and scheme Ⅱ）for designing a district cooling system（DCS）utilizing cold energy of liquefied natural gas（LNG）are presented.In scheme Ⅰ,LNG cold energy is used to produce ice,and then ice is transported to the central cooling plant of the DCS.In scheme Ⅱ,return water from the DCS is directly chilled by LNG cold energy,and the chilled water is then sent back to the central plant.The heat transportation loss is the main negative impact in the DCS and is emphatically analyzed when evaluating the efficiency of each scheme.The results show that the DCS utilizing LNG cold energy is feasible and valuable.The cooling supply distance of scheme Ⅱ is limited within 13 km while scheme Ⅰ has no distance limit.When the distance is between 6 and 13 km,scheme Ⅱ is more practical and effective.Contrarily,scheme Ⅰ has a better economic performance when the distance is shorter than 6 km or longer than 13 km.

Petroleum substitution, greenhouse gas emissions reduction and environmental benefits from the development of natural gas vehicles in China

This study develops a bottom-up model to quantitatively assess the comprehensive effects of replacing traditional petroleum-powered vehicles with natural gas vehicles（NGVs） in China based on an investigation of the direct energy consumption and critical air pollutant（CAP） emission intensity, life-cycle energy use and greenhouse gas（GHG） emission intensity of NGV fleets. The results indicate that, on average, there are no net energy savings from replacing a traditional fuel vehicle with an NGV. Interestingly, an NGV results in significant reductions in direct CAP and life-cycle GHG emissions compared to those of a traditional fuel vehicle, ranging from 61% to 76% and 12% to 29%, respectively. Due to the increasing use of natural gas as a vehicle fuel in China（i.e. approximately 28.2 billion cubic metres of natural gas in2015）, the total petroleum substituted with natural gas was approximately 23.8 million tonnes（Mt）, which generated a GHG emission reduction of 16.9 Mt of CO2 equivalent and a CAP emission reduction of 1.8 Mt in 2015. Given the significant contribution of NGVs, growing the NGV population in 2020 will further increase the petroleum substitution benefits and CAP and GHG emission reduction benefits by approximately 42.5 Mt of petroleum-based fuel, 3.1 Mt of CAPs and 28.0 Mt of GHGs. By 2030, these benefits will reach 81.5 Mt of traditional petroleum fuel, 5.6 Mt of CAPs and 50.5 Mt of GHGs, respectively.

A Novel Process for Natural Gas Liquids Recovery from Oil Field Associated Gas with Liquefied Natural Gas Cryogenic Energy Utilization

A novel process to recovery natural gas liquids from oil field associated gas with liquefied natural gas (LNG)cryogenic energy utilization is proposed.Compared to the current electric refrigeration process,the proposed process uses the cryogenic energy of LNG and saves 62.6%of electricity.The proposed process recovers ethane, liquid petroleum gas(propane and butane)and heavier hydrocarbons,with total recovery rate of natural gas liquids up to 96.8%.In this paper,exergy analysis and the energy utilization diagram method(EUD)are used to assess the new process and identify the key operation units with large exergy loss.The results show that exergy efficiency of the new process is 44.3%.Compared to the electric refrigeration process,exergy efficiency of the new process is improved by 16%.The proposed process has been applied and implemented in a conceptual design scheme of the cryogenic energy utilization for a 300 million tons/yr LNG receiving terminal in a northern Chinese harbor.

Evaluation of natural gas hydrate resources in the South China Sea using a new genetic analogy method

Natural gas hydrate(NGH)has attracted much attention as a new alternative energy globally.However,evaluations of global NGH resources in the past few decades have casted a decreasing trend,where the estimate as of today is less than one ten-thousandth of the estimate forty years ago.The NGH researches in China started relatively late,but achievements have been made in the South China Sea(SCS)in the past two decades.Thirty-five studies had been carried out to evaluate NGH resource,and results showed a flat trend,ranging from 60 to 90 billion tons of oil equivalent,which was 2-3 times of the evaluation results of technical recoverable oil and gas resources in the SCS.The big difference is that the previous 35 group of NGH resource evaluations for the SCS only refers to the prospective gas resource with low grade level and high uncertainty,which cannot be used to guide exploration or researches on development strategies.Based on the analogy with the genetic mechanism of conventional oil and gas resources,this study adopts the newly proposed genetic method and geological analogy method to evaluate the NGH resource.Results show that the conventional oil and gas resources are 346.29×10^(8)t,the volume of NGH and free dynamic field are 25.19×10^(4)km^(3) and(2.05-2.48)×10^(6)km^(3),and the total amount of in-situ NGH resources in the SCS is about(4.47-6.02)×10^(12)m^(3).It is considered that the resource of hydrate should not exceed that of conventional oil and gas,so it is 30 times lower than the previous estimate.This study provides a more reliable geological basis for further NGH exploration and development.

A power plant for integrated waste energy recovery from liquid air energy storage and liquefied natural gas

Liquefied natural gas(LNG)is regarded as one of the cleanest fossil fuel and has experienced significant developments in recent years.The liquefaction process of natural gas is energy-intensive,while the regasification of LNG gives out a huge amount of waste energy since plenty of high grade cold energy(-160℃)from LNG is released to sea water directly in most cases,and also sometimes LNG is burned for regasification.On the other hand,liquid air energy storage(LAES)is an emerging energy storage technology for applications such as peak load shifting of power grids,which generates 30%-40%of compression heat(-200℃).Such heat could lead to energy waste if not recovered and used.The recovery of the compression heat is technically feasible but requires additional capital investment,which may not always be economically attractive.Therefore,we propose a power plant for recovering the waste cryogenic energy from LNG regasification and compression heat from the LAES.The challenge for such a power plant is the wide working temperature range between the low-temperature exergy source(-160℃)and heat source(-200℃).Nitrogen and argon are proposed as the working fluids to address the challenge.Thermodynamic analyses are carried out and the results show that the power plant could achieve a thermal efficiency of 27%and 19%and an exergy efficiency of 40%and 28%for nitrogen and argon,respectively.Here,with the nitrogen as working fluid undergoes a complete Brayton Cycle,while the argon based power plant goes through a combined Brayton and Rankine Cycle.Besides,the economic analysis shows that the payback period of this proposed system is only 2.2 years,utilizing the excess heat from a 5 MW/40 MWh LAES system.The findings suggest that the waste energy based power plant could be co-located with the LNG terminal and LAES plant,providing additional power output and reducing energy waste.

Thermodynamic analysis and combined cycle research on recoverable pressure energy in natural gas pipeline

Current research and ways of capturing mechanical energy are discussed in this paper. By the aid of the comprehensive thermodynamic analysis and Aspen simulation tool, the amount of a vailable work that can be produced from capturing the pressure energy has been calculated. Based on the comprehensive thermodynamic analysis, two systems have been proposed to capture pressure energy of natural gas to generate electricity. In this study, the expression of exergy is given which can be used in evaluating purposes. A problem with this multidisciplinary study is the complicated boundary condition. In conclusion, a technical prospect on recoverable natural gas pressure energy has been presented based on total energy system theory.

Current State and Prospect of China Natural Gas Industry

Natural gas output remained stable growth and reached 130.9 billion cubic meters in 2015, 3% higher than the same period last year. Shale gas saw huge progress. China titus became the third country in the world fu!filling commercial development after U.S. attd Canada. Natural gas import growth and growth rate declined obviously, and the imported pipeline gas and LNG totaled 61.2 billion cubic meters in 2015. Apparent natural gas consumption was 186.5 billion cubic meters in 2015, rising by 4.4% as compared with the same period last year, but it hit a historic low. There is higher dozonward pressure on domestic macro economy in 2016. However, natural gas demand will see more rapid growth, propelled by such favorable factors as gas price regulation and environmental protection policies. It is prospected that natural gas market will take a turn for the better than in 2015, and natural gas supply will still be rich in general in 2016.

Reserves of Natural Gas Hydrates Equivalent to 100–150 Billion m^3 Natural Gas Has Been Discovered in the Pearl Mouth Basin of the South China Sea

Scientists have suggested that combustible ice in global marginal seas,deep trough areas and ocean basins covers an area of 400million km2,and its total reserve is twice the amount of the global proven oil,coal and gas reserves,equivalent to 50 times the amount of conventional natural gas reserves.

Hydrate phase transition and seepage mechanism during natural gas hydrates production tests in the South China Sea:A review and prospect

Natural gas hydrates(NGHs)are globally recognized as an important type of strategic alternative energy due to their high combustion efficiency,cleanness,and large amounts of resources.The NGHs reservoirs in the South China Sea(SCS)mainly consist of clayey silts.NGHs reservoirs of this type boast the largest distribution range and the highest percentage of resources among NGHs reservoirs in the world.However,they are more difficult to exploit than sandy reservoirs.The China Geological Survey successfully carried out two NGHs production tests in the Shenhu Area in the northern SCS in 2017 and 2020,setting multiple world records,such as the longest gas production time,the highest total gas production,and the highest average daily gas production,as well as achieving a series of innovative theoretical results.As suggested by the in-depth research on the two production tests,key factors that restrict the gas production efficiency of hydrate dissociation include reservoir structure characterization,hydrate phase transition,multiphase seepage and permeability enhancement,and the simulation and regulation of production capacity,among which the hydrate phase transition and seepage mechanism are crucial.Study results reveal that the hydrate phase transition in the SCS is characterized by low dissociation temperature,is prone to produce secondary hydrates in the reservoirs,and is a complex process under the combined effects of the seepage,stress,temperature,and chemical fields.The multiphase seepage is controlled by multiple factors such as the physical properties of unconsolidated reservoirs,the hydrate phase transition,and exploitation methods and is characterized by strong methane adsorption,abrupt changes in absolute permeability,and the weak flow capacity of gas.To ensure the long-term,stable,and efficient NGHs exploitation in the SCS,it is necessary to further enhance the reservoir seepage capacity and increase gas production through secondary reservoir stimulation based on initial reservoir stimulation.With the constant progress in the NGHs industrialization,great efforts should be made to tackle the difficulties,such as determining the micro-change in temperature and pressure,the response mechanisms of material-energy exchange,the methods for efficient NGHs dissociation,and the boundary conditions for the formation of secondary hydrates in the large-scale,long-term gas production.

Energy Internet Promotes the Reform and Development of Natural Gas Industry

Not only being abundant in resources, natural gas also helps power grids consume wind energy, solar energy and etc. The promotion of natu ral gas is an essential zoay to facilitate the development of nezo energy and complete the transition to an energy system where the renewable energy is dominant. The operation of energy Internet with a concept of equal, open, cooperative and sharing, and the optimization of a combined energy of gas, electricity, heating and cooling, could significantly improve the energy efficiency. Meanwhile, the development of energy lnternet technology will subvert the existing division of energy industry, and generate new commercial formats with features of highly openness. It will also subvert some existing market rules, change the governance methods, generate renovations in organizations, business models and government management methods, thus requires further revolution in energy industry. In order to promote the rapid and healthy development of ＂lnternet plus＂ natural gas industry, a series of policies and precautions are needed to be inhvduced and improved.

Changes in China--Beijing is seeking less energy-intensive economic growth ＆ a less carbon-intensive energy mix and its impact over oil ＆ gas supply

Having experienced over 30 years of rapid growth,China’s economic development is entering a new normal featured by an ever optimizing economic structure shifting from high-speed to medium-high speed growth,and from factor-driven to innovation-driven pattern.In adapting

Gas Sources of Natural Gas Hydrates in the Shenhu Drilling Area, South China Sea: Geochemical Evidence and Geological Analysis

The Shenhu gas hydrate drilling area is located in the central Baiyun sag, Zhu I! depression, Pearl River Mouth basin, northern South China Sea. The gas compositions contained in the hydrate-bearing zones is dominated by methane with content up to 99.89% and 99.91%. The carbon isotope of the methane （δ^13C1） are -56.7%0. and -60.9%0, and its hydrogen isotope （δD） are -199%0 and -180%0, respectively, indicating the methane from the microbial reduction of CO2. Based on the data of measured seafloor temperature and geothermal gradient, the gas formed hydrate reservoirs are from depths 24-1699 m below the seafloor, and main gas-generation zone is present at the depth interval of 416-1165 m. Gas-bearing zones include the Hanjiang Formation, Yuehai Formation, Wanshan Formation and Quaternary sediments. We infer that the microbial gas migrated laterally or vertically along faults （especially interlayer faults）, slump structures, small-scale diapiric structures, regional sand beds and sedimentary boundaries to the hydrate stability zone, and formed natural gas hydrates in the upper Yuehai Formation and lower Wanshan Formation, probably with contribution of a little thermogenic gas from the deep sedments during this process.

Geology and hydrocarbon accumulations in the deepwater of the northwestern South China Sea——with focus on natural gas

The deepwater of the northwestern South China Sea is located in the central to southern parts of the Qiongdongnan Basin （QDN Basin）, which is a key site for hydrocarbon exploration in recent years. In this study, the authors did a comprehensive analysis of gravity-magnetic data, extensive 3D seismic survey, cores and cuttings, paleontology and geochemical indexes, proposed the mechanism of natural gas origin, identified different oil and gas systems, and established the model of hydrocarbon accumulations in the deep-water region. Our basin tectonic simulation indicates that the evolution of QDN Basin was controlled by multiple-phased tectonic movements, such as Indochina-Eurasian Plate collision, Tibetan Uplift, Red River faulting and the expansion of the South China Sea which is characterized by Paleogene rifting, Neogene depression, and Eocene intensive faulting and lacustrine deposits. The drilling results show that this region is dominated by marine- terrestrial transitional and neritic-bathyal facies from the early Oligocene. The Yacheng Formation of the early Oligocene is rich in organic matter and a main gas-source rock. According to the geological-geochemical data from the latest drilling wells, Lingshui, Baodao, Changchang Sags have good hydrocarbon-generating potentials, where two plays from the Paleogene and Neogene reservoirs were developed. Those reservoirs occur in central canyon structural-lithologic trap zone, Changchang marginal trap zone and southern fault terrace of Baodao Sag. Among them, the central canyon trap zone has a great potential for exploration because the various reservoir- forming elements are well developed, i.e., good coal-measure source rocks, sufficient reservoirs from the Neogene turbidity sandstone and submarine fan, faults connecting source rock and reservoirs, effective vertical migration, late stage aggregation and favorable structural-lithological composite trapping. These study results provide an important scientific basis for hydrocarbon exploration in this region, evidenced by the recent discovery of the significant commercial LS-A gas field in the central canyon of the Lingshui Sag.

An analysis of the types and distribution characteristics of natural gas reservoirs in China

The natural gas reservoir beds of different areas in China can be divided into three kinds, clastic natural gas reservoir bed, carbonate natural gas reservoir bed and special natural gas reservoir bed. They have different combination patterns controlled by deposition, diagenesis and tectonism. Our analysis indicates that the natural gas reservoirs are mainly distributed in the Precambrian, Palaeozoic, Mesozoic, and Tertiary-Quaternary. Craton basin, foreland basin and intracontinental rift basin which contain most of natural gas in China have special geological features and favorable accumulation conditions, and will be important exploration areas in the future.

The second natural gas hydrate production test in the South China Sea

Clayey silt reservoirs bearing natural gas hydrates(NGH)are considered to be the hydrate-bearing reservoirs that boast the highest reserves but tend to be the most difficult to exploit.They are proved to be exploitable by the first NGH production test conducted in the South China Sea in 2017.Based on the understanding of the first production test,the China Geological Survey determined the optimal target NGH reservoirs for production test and conducted a detailed assessment,numerical and experimental simulation,and onshore testing of the reservoirs.After that,it conducted the second offshore NGH production test in 1225 m deep Shenhu Area,South China Sea(also referred to as the second production test)from October 2019 to April 2020.During the second production test,a series of technical challenges of drilling horizontal wells in shallow soft strata in deep sea were met,including wellhead stability,directional drilling of a horizontal well,reservoir stimulation and sand control,and accurate depressurization.As a result,30 days of continuous gas production was achieved,with a cumulative gas production of 86.14×104 m3.Thus,the average daily gas production is 2.87×10^4 m^3,which is 5.57 times as much as that obtained in the first production test.Therefore,both the cumulative gas production and the daily gas production were highly improved compared to the first production test.As indicated by the monitoring results of the second production test,there was no anomaly in methane content in the seafloor,seawater,and atmosphere throughout the whole production test.This successful production test further indicates that safe and effective NGH exploitation is feasible in clayey silt NGH reservoirs.The industrialization of hydrates consists of five stages in general,namely theoretical research and simulation experiments,exploratory production test,experimental production test,productive production test,and commercial production.The second production test serves as an important step from the exploratory production test to experimental production test.

The potential of domestic production and imports of oil and gas in China:an energy return on investment perspective

Concerns about China’s energy security have escalated because of the country’s high dependency on oil and gas imports, so it is necessary to calculate the availability of domestic oil and gas resources and China’s ability to obtain foreign energy through trade. In this work,the calculation was done by using the energy return on investment（EROI） method. The results showed that the EROIstnd（i.e., standard EROI） of China’s oil and gas extraction decreased from approximately 17.3：1 in 1986 to 8.4：1 in 2003, but it increased to 12.2：1 in 2013. From a company-level perspective, the EROIstnddiffered for different companies and was in the range of（8–12）：1. The EROI2,d（EROI considering energy outputs after processed and direct energy inputs） for different companies was in the range of（3–7）：1. The EROI of imported oil（EROIIO）declined from 14.8：1 in 1998 to approximately 4.8：1 in 2014, and the EROI of imported natural gas（EROIING）declined from 16.7：1 in 2009 to 8.6：1 in 2014. In 2015, the EROIIO and EROIING showed a slight increase due to decreasing import prices. In general, this paper suggests that from a net energy perspective, it has become more difficult for China to obtain oil and gas from both domestic production and imports. China is experiencing an EROI decline, which demonstrates the risk in the use of unsustainable fossil resources.