The Changqing Subsidiary of PetroChina, the largest oil producer in China,
has been forced to sacrifice one billion yuan (125 million U.S. dollars) in
profits to protect drinking water supplies in northwest China's Shaanxi
Province.
The company has sealed 102 wildcat oil wells close to the
Wangyao Reservoir, a drinking water source for a population of 300,000 in Yan'an
City, amid fears there was a risk of contaminating the underground water. The
drilling wells produced 80,000-100,000 tons of crude oil a year.
"The
closure of the wells and the relocation of 26 oil pipelines linking the wells
will inflict one billion yuan (125 million U.S. dollars) in direct economic
losses this year," said Su Zhifeng, head of drilling operations.
"However, guaranteeing the safety of the drinking water makes the
sacrifice worthwhile," he said.
The Changqing Oilfield Co., responsible
for the exploitation of 370,000 square km of proven oil resources in the Erdos
Basin, reported 7.02 million tons of crude oil production in the first eight
months, accounting for nearly one tenth of the total crude oil output of China
National Petroleum Corp, the parent company of the listed
PetroChina.
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