CNPC, Hess Sign Shale Oil PSC

China National Petroleum Corp (CNPC) and Hess Corporation have signed a deal to explore for shale oil in Malang Block of the Santanghu Basin in Xinjiang, China, CNPC said in a statement.

Reuters has reported that the production sharing contract is China's first joint agreement to develop a shale oil block.

In December last year, China's National Development and Reform Commission had approved a shale oil exploration project between China National Petroleum Corp. and a foreign partner in the northwestern Xinjiang Uyghur autonomous region.

Hu Wenrui, former vice president of PetroChina, told reuters that Chinese companies have so far drilled about 20 shale oil exploratory shale oil wells, mostly in northern China's Ordos basin. 'China has done very preliminary evaluations on shale oil resource, much less work compared with shale gas,' Hu said.