LOCATIONS OF PETROLEUM, OIL SHALE AND NATURAL GAS RESOURCES/YUMEN AND OTHER OIL FIELDS/REFINERIES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP82-00047R000400200007-7
• Release Decision: RIPPUB
• Original Classification: C
• Document Page Count: 5
• Document Creation Date: December 27, 2016
• Document Release Date: April 26, 2013
• Sequence Number: 7
• Publication Date: March 12, 1954
• Content Type: REPORT

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CLASSIFICATION /CONFIDENTIAL
CENTRAL INTELLIGENCE AGENCY
INFORMATION REPORT
COUNTRY China
SUBJECT Locations of Petroleum, Oil Shale and Natural
Gas Resourcesiftimen and other Oil Fields/Refineries
PLACE
ACQUIRED
DATE
ACQUIRED
DATE OF INFOMATION
/NIB DOCUMENT CONTAINS INFORMATION AFFECTINS THE NATIONAL DEFENSE
OF THE UNITED STATES, WITHIN THE IRANIAN OF TITLE 18, BECTIONS 793
AND 794, OF THE U.E. CODE, AS AMENDED. ITS AAAAAA ISSION OR REPT.
LOTION OF ITS CONTENT* TO OR RECEIPT SY AN UNAUTHORIZED PERSON IS
PROHISITED ST LAN. THE REPRODUCTION CP THIS FORM is PROHIEITED.
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DATE DISTR. /;,March 1954
NO. OF PAGES 5
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NO. OF ENCLS.
(LISTED BELOW)
SUPPLEMENT TO
REPORT NO.
ORR 7527
THIS IS UNEVALUATED INFORMATION
1, China's Geologically. Surveyed Petroleum Deposits Which Are Considered Very Promising:
a. In 1948 the Chinese Nationalist Government believed that China's most favorable
petroleum areas were to be found in the area encompassed by the Provinces of 50X1
Sinkiang, Tsinghii, Kansu and Shensi. oil prospects in
Sinkiang, Tsinghai and Kansu are the most favorable of any other area of China
Although oil seepage occurs in scattered areas throughout northwest and north
central China, The CPC's .&-hinese Petroleum Corporatiolg geological surveys
have indicated that petroleum prospects were most favorable in the following
areasg
(1) Chingtsaowan, Kansu Province (a few kms southwest of Chihkinpu)
(2) Tahunchuan, Kansu Province (one-third of the way from the YlImPn oil field
to Kiuchuan (Suchow))
(3) Wenshushan, Kansu Province (10 to 20 kms south of Kiuchuan)
(4) Minh?, Tsinghai Province (very close to the Kansu border)
(5) Tsaha Tsiaoto, Tsinghai Province (near the Sinkiang, Tsinghai and Kansu
borders)
(6) Tseliuching, Szechwan Province
b. Of the above the most likely fields that the Chinese Communists might exploit
in the future, if they have not done so already and if no new unusually good.
fields are discovered in the meantime, are Chingtsaowan, Tahunchuan? Wenshushan,
Minh? and Tsaha Tsiaoto. Although Wenshushan is considered to be by far the
largest deposit, it is rather broken. The most favorable from the geological
standpoint is Chingtsaowan. Minho is the most shallow field, the oil deposit
being approximately 1,000 to 1,500 feet below the surface of the earth. The
plans of the CPC called for Chingtsaowan and Minho to be the first two of
the above six favorable petroleum areas to be drilled. Their schedule called
for drilling operations to begin at these two fields in 1948, however, this
had to be postponed for lack of adequate funds. Oil was discovered at
Tseliuching by the Chin Ta Chemical Works in 1947 when drilling a salt water
well. It is believed that this deposit is a small one.
Sag LAST PAGE FOR SUBJECT ilk AREA cppgs
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DISTRIBUTION
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2. Producing and Abandoned Oil Fields:
50X1 a. Yemen or Laochunmiao (Kansu):
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50X1 e. Kweiting (Kveinhow): old oil well here, consisting of a shaft
100 to 125 feet deep and six to seven feet in diameter, which had been abandoned
for soma time. The oilsat.Kweiting occurs in limestone.
The Laoehunmiao.Oil Field (Kansu):
a. tame and Location: Laochunmiao is frequently also referred to as the Yemen
oil field, although the former is its official name. It is located about 60 kms
south of Yemen and several kms south and, approximately 80 kms, west 'of Kiuchuan
(SUchow). All communication with Laochunmiao oil field is carried on not
through. Yemen but via Kiuchuan,
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b. Tushantzu or Wusu (Sinkiang): The grade of crude oil at Tushantzu is much
higher than that of Lapchnnmiao (Yemen), however, the production per well is
much lower. A well it Tushantzu producing one ton of crude oil per day was
considered to be a very good producer, whereas at Laochunmiao if a well produced
lese than three tons it was shut-in. This oil field was officially known as
the TUshantzu oil field rather than Wusu. It was under the jurisdiction of
the KPA gensu Petroleum Administration7 for only one year, between 1943 and
1944. Prior to and after that period the Soviets were in full control of the
crude oil production and refining at Tushantzu.
c. XenalsnlasgpingnEd Yenchang (Shensi): These three fields are not too far apart.
The Standard Dl. Company originally drilled six or seven shallow wells there in
perhaps 1910. In 1915 Yen Shuinng, later Vice President of the CPC, peraonalAy
headed an .exploration team to these three fields. The drilling operations at
that time resulted in very little oil. In 194L to 1945, when the Chinese
Communists moved into this territory, the annual production of these three
fields was approximately four thousand barrels .
Fuhsin(Jeh61): The Japanese drilled from 30 to 100 wells here Prior to 1941,
but the Chinese Natinnalist Government never resumed the operation because nYe
production was too low to be profitable. The'abandonensequipment'was later
dismantled and shipped to Southeast Asia,
b. History: This field was first discovered in 1938 by members of the KPA. The
actual production did not start until About February 1939.
c. alililai_2rianization and Top Administrative Personnel: From 1938 to 1946
Laochunmiao was under the direction of the KPA of the NRC ffaticnal Resources
Commienion of Chini7. In 1946 the KPA and the Szechwan Exploration Corps were
merged, and formed under the NRC into the CPC. The four main functional divisions
of CPC were General Affairs, Finance and Accounting, Sales and Purchasing, and.
50X1 Transportation. At Laochunmiao following nine departments: General
Affairs (Administrative and personnel branches plus the maintenance of a
hospital) police force, school and other miscellaneous employee facilities such
as cafes, groceries, tailor shops, etc); Sales and Purchasing; Finance and
Accounting; Transportation; Mechanical and Electrical; Civil and Architectural;
Exploration; Production and Refining, In 1948 the top petroleum people in
China were Wong Wen-hao, Premier and Head of the Executive Yuan; Sun Yueh-ch'i,
Chairman of the NRC; Wu Chao-hung, Secretary General of the NRC; T KChang,
President of the CPC; and the four Vice Presidents of the CPC, K Y King, Kuo
Ke-chuan, Yen Shuang and Thou Ming. In September 1948 Tsou Ming replaced Kuc
'Ke-chuan as Manager of the Kansu-Tsinghai Branch of the CPC, which had under
its jurisdiction the Laochunmiao oil field. Of the above named top Chinese ad-
ministrative personnel in the petroleum field all but T K Chang and K Y King
remained in China when the Communists' took over the country.
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d.:.Petroleum and. Other Personnel
50X1------71?1-6?Ziiiie-7:7"?Trakear of activity and for the number of workers em-
50X1 PlOyed there. 122.1946 the total number of KPA employees' wasslightly over
ten thdusand. This number Included not only the employees Who were located
at Laochunmiap but also ,those who were stationed at the IA headquarters in
Chungking arid. others who Maintained repair and supply facilities between
Lacidirdamiao and Chungking. After the CPC was organized in 1946i the total num-
ber' of employees dropped considerably. The greater portionof KPA, and later
the CPCt;employees however, were located at Laochimmiao. The entire popuIa-
tiOn of the XPA constructed village of Laochunmiao, ekcluding the relatives
and dependents of the workers, was employed by the organization. Therefore,
the, total number of employees included not Only 'skilled and unskilled laborers
of all sOrt6, and administrative and clerical personnel, but also farmers, ?
shopkeepers, tailors, etc. In September 1948 the Production Department at
Laochuamiao had a total of approximately 400 workers. Of this number about
60. Wire. drilling and production engineer's, Who were divided.' into three drilling
teams.' 'The 'Refining Department also had approximately 60 engineers. Thtre
were six TM employees at Laochuamiao -- three drilling, two refining, and one
production engineer.' .
e.E.loratiortadsizeoang. The oil at LaoChUnniao occurs in the anti-
cliflal strcte of Tertiary Age. The sb-called K sand is from 400 to 600 feet
below the surface of the earth and the main producing sand, or L sand, is at
a. depth of from 11000' to 1,700 'feet.
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One bleivoUt at Ltochunmiao was estimated to' flaw 960,000 gallons of
crude'bil .1.a"24 hours..
the oil field covers an area of approximately 4)800
acres. Of.alltbe wells drilled at Laochrinviao, only one was dry. It 4as drilled
it:1948 th an' attempt to find theaiMitabf the field.
f. Numbe,, ok Abandoned Producin and New Wells In September 1948 there were
aboo:, 10 abandoned Ind 35 producing wells at Laochunmiao. Of the 35 produel
wells at least 20 ..,ere new, less than two years in production.
g.
eicri stion and Number 'of Drillin RI and Other PetroleuM Es ui entz Lao-
chunniao, in 19 had a total of four drilling rigs. Three Of these Were of
USnlanufacture,- having 'been purchased from the National Supply Company, and
50X1 one of German manufacture.
50X1 The German drilling rig was very old and badly in need of
and was threfore not being used in 1948. Other than the' above there
other major pieces of equipment at Lacchanmiao? just small quantities
and local manufactured trivial .equipment and toc518
h. Production guality ofTroduttion: All wells at
Laochunmiao were flowing wells and not of the pumping- Variety. The gravity'
of crude oil produced. at Laochunmiao was 33 API degrees.
repairs
were no
of US
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the annual production figures for China on page 74
of the 15 Aug 53 issue (International Operations Issue) of World Oil are
actually those of Laochunmiao, as at that time there were no other significant
producing fields, and are accurate and reliable up to the year l9149 It is
obvious that the figures for the year 1949 and for subsequent years are meretv
an estimate and probably not a very good one.. Production is bound to vary
from. year to year for .any number of reasons, excluding the drilling of
wells and the abandonment of depdeted ones, and would certainly not be identi-
cal, or nearly so, for four years in a row. .
Storage and RefiningFacilities A. very small percentage of the crude oil.
Production at Laochunmiao was actually stored- As the refinery was located
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on the north edge of the field, about one km north of the last well and on a
lover level than the wells, most of the daily crude oil production was piped,
through a four inch pipe, to the refinery. Some crude oil was stored in abovf,-
ground steel tanks, their total combined capacity being at most ten thousand
barrels. Thera were two large storage tanks, with a capacity of two thousand
barrels each, and a number of smaller ones. One large storage tank was located
near the old refinery (topping units) and one at the new refinery (thermo-
cracking unit). The smaller ones were scattered throughput the field. In
SePtember 1948 anoiher large storage tank, this one with a capacity of over
"WO thousand barrels, was being constructed near the new refinery.
Refinery The LaOchunmiab refinery con-
sisted of one thermo-cracking unit, with a capacity of one thousand barrelE a
day, and tvo topping units, with a combined capacity of from 1,000 to 1,500
barrels e'day. In 'September 1948, 35% of the crude oil processed through the
thermo-cracking unit went into the production of gasoline. The products, end
the percentage of the total production devoted to them, refined by the two
topping 'units were, diesel oil -.25 to 30%, fuel oil - 20 to 25%, kercsere -
20 to 25%, gasoline - 18 to 20%, paraffine wee - less than 5%, lubricating
oil - less than 5%. In September 1948 there as no aviation gasoline being
refined at Laochunmiao, or anywhere else in China. The aatural gas production
of Laochunmiab was from 400 to 700 cubic feet per barrel of oil produced.
This was all used locally as fuel for heating boilers and living quarters atd
for other domestic uses such as cooking,
k. Row and Where Refined Products were Trans orted: In September 1948 there was
no Pipeline or railroad anywhere near Laochunmiao, therefore all of the re
fr rdts had o.be transported by truck in drums whose capacity was e0
to 5..; balloms each. Most of the trucks assigned to the oil field were three
ton Chevrolets, 500 were delivered in 1943, capable of carrying a total of
18 .drums.each. We also had a few 4i ton Dodge trucks that could carry 27 drums
each. Throughout World War II most of the Laochunmiao production was trans-
ported to Chungking The trucks consumed one-third to two-thirds of their
total load cf gasoline on each round trip between Laochunmiao and ChungkinG
A very small perceetage of the production during that petiod was also trans-
ported to various pont s in Sinkiang, Kansu and Shensi Provinces. After the
end of World Wax II eel? up to September 1948 all of the Laochunmiao production
was used in the northwestern provinces of China.
4. Refineries: The following are the only other refineries, in addition to the ones
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of 1948:
a. The Japanese were building a ten thousand barrel a day refinery in Shanghai,
at Kaochiao, but did not quite complete it when World War II ended. The
Chinese Nationalist Government did not attempt to complete its construction
It would riot. be. a difficult task for the Chinese Communists to put this refinery
into operation.
b. Another modern refinery was under constructien by the Japanese during World
War II at Chithei in Manchuria.
50X1 it was to be much larger than the Kaoshiung
(Takao refinery on the Island o Formosa. The daily capacity of the Kaoshieng
50X1 refinery is from six thousand to ten thousand barrels a day. Therefore: tne
Chinhsi refinery was to have had a capacity of well over ten thousand barreee
a day. It was not completed prior to the Japanese surrender and nothing was
done to it by the Chinese Nationalist Government. In 1948 when the Chinese
'Nationalist forces withdrew from Manchuria they dismantled and shipped most
of this refining equipment to Taiwan, where It was utilized at the Kao hiung
refinery.
CONFIDKNTIAL
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another large refinery that was being built by the Japanese at
Yungchi, in the Chilin Province of Manchuria. The Chinese NatiOnalist.GOvern-
ment.attempted to complete this refinery, .but had riot done so by 1910. It
was not dismantled when the Chinese NationalistforceS Withdrew from ManchUria.
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5. Oil Shale Deposits:
a. Fushun (ManChuria): the largest known deposit of
=Tale in China is at Fushun in Manchuria. It was said that the oil shale
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Of Fushun is five billion four hundred million (5,400,000i000) tons. The total
oil shale reserve in Manchuria is estimated to be sixty billion (600000,000,000)
tons, The Oil. shale deposit- at Fushun is unique in that it occurs directly
above the coal -seam of the Fushun coal mine. This coal is lignite and the seam
is 160theters thick, an unusually thick seam for China Or any other country.
"reiretor6, the over-all operation of extracting and processing this oil shale
istt very economic one because the shale has to be removed anyway to mine the
cOal. Ile Japanese were processing this oil shale ad. their schedule called.
for the PrOdUction of eight hundred thousand (8000000) tons of' oil Pet year by
108.
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Pin eh (KWeichow)i The only other Oil Shale deposit in China
the one that was discovered near PingyUeh in nteiohov Province,
not know the Size of this deposit.
6. Natural Gas Fields The CPC owned two natural gac, fields in the Szechwan. basin.
One Is called Shengtengshanand is. located at Lungchang. The other is Shibyiukou
nearChtngking These Are the oldest natural gas fields in the world, there adready
being over ten thousand-wells there prior to the year 1700.
-41e1b1004miecr-i-AREA CODES
622.021 436L
622.02! 83JL.
622.02i 4ML
1-12/735.5 1431L
1-A2/735.5 8311_
1-12/735.5 41,L.
735,5 211L
4-5/735-5 7311-
3-42/735.5 c4IL
735.592 4311_
4-42/735,5 4314_
4-6/735.5 4314_
4-5/735.5 4314.
735.54 4311-
4-4o/735.54 434L
io/735.6
735.54 581i.
3-42/735.54 41L
14-42/735.54 4]t..
4-5/735.6 4344_
1-42/735.81 444_
1-12/735.4 41t.
735.4 iL/c
4-12/735.81 8844_
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