Upstream business is a driver for Brightoil’s future growth. It will add value to the company and serve as an engine to propel its transformation towards a resource-focused company. In order to accelerate the development of upstream projects, Brightoil has established an international team to proactively identify business opportunities both in China and overseas. It will earmark more financial and technical resources for upstream business expansion, aiming to increase oil and gas reserves and production. The Group has three oil and gas field projects in its portfolio, including Dina1 Gas Field and Tuzi Gas Field in Tarim Basin of Xinjiang, Caofeidian Oilfield Blocks in Bohai Bay. The Company's interest in 2P storage have reached approximately 9.37 billion cubic meters of natural gas and 37.61 million boe of crude oil. As promising gas reserves were detected at Tuzi Gas Field during drilling tasks and approved by relevant departments for operation while the adjusted overall development plan of Caofeidian Oil Field has been implemented, the Company’s oil and gas reserves and production are expected to increase significantly.
Further to the cumulative efforts and positioning during over the past few years, our Upstream business made a significant breakthrough in FY2014 and shortly thereafter. The Group has successfully acquired from Anadarko Petroleum Corporation (“Anadarko”), a major United States (“US”) upstream explorer, the China operating company which owns their entire China oil producing assets located at Bohai Bay, in Northeast China. The Group has also successfully commenced natural gas production in Tuzi Gas Field, which is adjacent to our producing gas fields in Dina 1 Gas Field. Both of these gas fields are located in the gas-rich Tarim Basin in the Xinjiang Province, China and the commercial gas is sold to China National Petroleum Corporation (“CNPC”) then transported to eastern cities, such as Shanghai, via the West East Pipeline (“WEP”), a major gas trunk line linking the gas resources in the west of China to the major gas consumers in eastern China. These achievements in FY2014 and shortly thereafter were significant and have been a centre-piece in the transformation of the Group from a downstream company with trading, storage, oil transportation business to a resource-focused company.