“The 120-km long Duanshi-Bo’ai line will have a capacity of 1bn cum/yr, and the total investment in the project will be $53-$66.5 million),” Mr Sun said. Both other companies and local governments will work with CUCBM, the nation’s largest CBM firm, to construct the pipeline, Mr Sun said. “As China’s first cross-province CBM pipeline, the Duanshi-Bo’ai project will help Shanxi Province, an important CBM production base, to take advantage of its rich gas resources,” Mr Huang Shengchu, president of the China Coal Information Institute, commented. The pipeline will also ease the gas supply shortage in Henan Province, he said. Analysts said earlier that the province has a natural gas shortage of 1 billion cubic meters a year.
Located in the south of Shanxi Province, the Qinshui Basin has become an important CBM production base for CUCBM. The company, along with the nation’s largest oil firm PetroChina, has built production facilities in the basin with a capacity of 1bn cum/yr. “The CBM pipeline will provide our company with a bigger market for gas production in Shanxi. We are also planning other pipelines in Shanxi Province,” Mr Sun said.
China is expected to construct 10 CBM pipelines by the end of 2010, according to the 11th Five-Year Plan (2006-10) for the CBM industry. The pipelines will have a total length of 1,441km and capacity of 6.53bn cum/yr.
Coal-bed methane has components similar to natural gas. China boasts 37 trillion cum of CBM reserves, the third largest in the world after Russia and Canada. The country’s CBM sector has seen fast development since 2004, and in 2007 it will see double-digit growth to produce 3bn cum.