RICH GAS HYDRATE FOUND OFF TAIWAN

UNCLAS AIT TAIPEI 002973

SIPDIS

STATE PLEASE PASS TO AIT/W

SIPDIS



STATE FOR EAP/RSP/TC,
INTERIOR PASS USGS W.J. WINTERS

E.O. 12958: N/A
TAGS: ECON EFIN EMIN ENRG TW
SUBJECT: RICH GAS HYDRATE FOUND OFF TAIWAN



1. SUMMARY. Taiwan confirmed the discovery of rich reserves of gas
hydrate deposits off its southwestern waters. The current technology
for gas hydrate extraction is not yet fully developed, but the new
energy source could meet domestic consumption of natural gas for
more than 60 years. Experts from the U.S. are assisting Taiwan in
surveying this resource. END SUMMARY


2. Taiwan's Ministry of Economic Affairs (MOEA) confirmed August 17
that the seabed off Taiwan's southwestern waters contains rich
reserves of natural gas hydrate. MOEA said the reserves, if properly
extracted, could meet domestic consumption of natural gas for more
than 60 years.


3. Taiwan's Central Geological Survey (CGS) reported the reserves
are located between Kaohsiung and Hengchun in the southernmost tip
of Taiwan and cover an area of about 10,000 square meters. CGS
estimates the area contains 500 billion cubic meters of gas hydrate,
with an estimated worth of NT$5 trillion (about US$153 billion).


4. With the current demand for natural gas ranging between 7
billion and 8 billion cubic meters per year, the newly discovered
gas hydrate reserves will be able to meet domestic needs for at
least six decades, the officials said. CGS noted current extraction
technology for gas hydrates is still at an immature state and so
commercial production would only be possible in ten years.


5. State-owned China Petroleum Corporation (CPC) first detected
signs of gas hydrate reserves in the area in the early 1990s. CGS
then started exploration in the same area two and a half years ago.
Last year, Taiwan conducted a Tow-cam survey cruise in the
southwestern waters from September 30 to October 6 with the
participation of researchers from the US Woods Hole Oceanography
Institution, which helped confirm the existence of the resource. In
March this year, experts from the US Geological Survey attended a
Taipei gas hydrate workshop sponsored by Taiwan's CGS to review
Taiwan's progress in investigating the resource.


6. CGS official Chen Song-chun said Taiwan has purchased the TowCam
technology from the Woods Hole Oceanography Institution this year
and will conduct another survey cruise in the gas hydrate field in
October. Woods Hole researchers are expected to take part in the
cruise in October, Chen said.


7. Taiwan officials noted possible collaboration with countries
such as Japan and the U.S. for future development of the oceanic gas
hydrate deposits. As Taiwan has scant natural resources and 98
percent of its overall energy supply is imported, the discovery of
the gas hydrate field may lessen that dependency in the future, CGS
officials said.

Young