The United States energy independence is in stark contrast to China’s rising dependence on foreign resources. The international petroleum order-rebuilding and the China–US game have brought greater uncertainties to China’s oil and gas supply, and China’s energy security issues are increasingly prominent. China’s shale oil reserves rank the third in the world and present an important strategic alternative resource for China’s petroleum industry. To vigorously develop shale oil and promote China’s “shale revolution” is essential for ensuring the national energy security in an open climate. However, the shale oil upstream industry in China faces a lot of problems, such as low exploration quality, low recovery efficiency and imperfect policy system. In order to promote the high-quality development of the industry, China should learn from the US “shale revolution”. Specifically, China should focus on “three revolutions”: (1) the revolution of exploration quality, by performing the nationwide shale oil resource evaluation; (2) the revolution of technology and recovery efficiency, by devoting more efforts to key technologies of exploration and development; and (3) the revolution of system/mechanism, by accelerating the market-oriented reform of exploration and development.

The development of global shale oil is an important reference to the development of shale oil in China. After systematically collecting data and researching, and analyzing the development history and key points of US shale oil, including the development process, how to reduce cost and increase production, technologies, development models, economics, and supporting policies, it is found that the development model of shale oil is different from conventional energy, and it is more dependent on technological progress, cost reduction and financial support, and similar to new energy development models to some extent, so development in the stage early needs more supports. The explosive increase of shale oil in the United States is driven by breakthroughs in geological theory and advances in development technologies. The most important is the rapid reduction of the cost for developing shale oil. This not only thanks to technological advances, but also is the result of innovative business models. The global shale oil resources are abundant, and many countries and regions, such as North America, Argentina, Russia, and China, all had good start. In the future, global shale oil production will continue to grow and is expected to exceed 1000×104bbl/d after 2025. According to the characteristics of shale oil in China, shale oil would be strategic successive resources in China. To increase investment in science and technology research and development, give supporting policies, and create favorable conditions to attract more investment will ensure the large-scale development of shale oil during the 14th Five-Year Plan.

In recent years, China’s oil dependence on foreign countries has been increasing year by year, and the national energy security is becoming more and more severe, while the“shale revolution”in North America is actively moving forward. In order to broaden oil and gas exploration and development, and to find successive resources for increasing crude oil reserves and production in China, the types, potentials and prospects of continental shale oil in China were investigated and analyzed systematically. The results show that the continental shale oil resources in China have four geological characteristics, and can be divided into two types in terms of maturity: medium-high maturity and medium-low maturity. Both of the two types have great potentials – the former is estimated to be about 200×108tons, and the latter has a great amount of technically recoverable, prospective resources in situ transform. In recent years, a lot of progress in shale oil exploration have been made. For the shale oil of medium-high maturity, exploration discoveries have been made in three types of shale accumulation: synchronogenic source - reservoir, separated source - reservoir and exclusive shale. For the shale oil of medium-low maturity, in situ transform technology is under development and pilot test. Finally, in view of the future development of continental shale oil, four risk points are put forward and corresponding countermeasures are proposed based on China’s national conditions and actual geological conditions. Comprehensive research concludes that industrial development of continental shale oil is expected and it will be an important successive resource for increasing crude oil reserves and production in China.

In the process of shale oil exploration, Sinopec has gone through two stages: early block evaluation and exploration well test, and later new round of basic research and pilot test. Early shale oil exploration well tests found phenomena like difficult fracturing, unsustainability, low backflow and instable production for most wells developing continental shale oil. Supported by the National 973 Plan, the National Major Special Projects of Shale Oil and Sinopec Projects, technical researches focusing on shale facies, shale oil mobility and shale fracturability were carried out, and positive progress has been made. It has been found that laminated shale in saline lake basins is the most favorable lithofacies, and the shale oil with higher maturity is the primary target in recent research. A series of seismic methods for predicting shale oil sweet spots and engineering technology for continental shale oil have been formed preliminarily. During the period from the 13th Five-Year Plan to the 14th Five-Year Plan, Sinopec will intensify basic theory and technical research of shale oil with medium and high maturity, and strive to achieve large-scale commercial development of shale oil.

Based on the systematic study of the shale oil exploration and development and the operation of shale oil companies in the United States, the costs of shale oil are broken into mining right, well drilling, well completion, infrastructure and operation from the perspective of exploration and development process, and the composition and overall performance of every type of cost are analyzed. Taking the Bakken shale in ??the Williston Basin as a case, the estimated cost is around 50$/bbl. Then the continental shale oil resources and exploration and development progress in China are analyzed, and compared with the shale oil resources in the United States in terms of geological conditions. And finally, the investment and cost of yearly shale oil production of one million tons in China are estimated. The results show that shale oil resources are abundant in China, and are an important successor of conventional resources. Although shale oil has been produced, the cost is higher and commercial production has not yet achieved in China. The development experience of the United States shows that high cost is inevitable in early development. Technical advances and management innovation will reduce the cost and increase the production, and promote the exploration and development of shale oil to a new stage in China.

The Dagang oilfield has been explored and developed for more than 50 years. Now, it is confronted with some outstanding problems, such as downsizing conventional reserves and rapid production decline. In this regard, Dagang oilfield has begun to target the reservoirs with great resource potential, with the support of innovative concept, theory, technologies and management. First, Dagang oilfield innovatively proposes a concept of “intra-source hydrocarbon accumulation” to access to the continental shale oil in the Cangdong sag. Second, Dagang oilfield innovatively puts forward the enrichment theory of “dominant petrofabricfacies–retaining hydrocarbon transcendence effect”, thus identifying the enrichment mechanism of continental shale oil. Third, Dagang oilfield innovatively develops a series of technologies for sweet spot identification and evaluation, horizontal well drilling acceleration, and subdivided volume fracturing, which allow the high and stable production of horizontal shale oil wells. Fourth, Dagang oilfield achieves innovative management by adopting the economic benefit anti-driving mechanism, leading to sharp reduction of total cost. The industrial development of continental shale oil in the second member of Kongdian Formation (Kong-2 Member) in Cangdong sag heads the shale oil industry and provides a reference for China’s shale oil revolution.

Rich unconventional petroleum resources are developed in the Chang 7 Member of the Mesozoic Triassic Yanchang Formation in the Ordos Basin. At present, there are still disputes on whether it is tight oil or shale oil. According to the current situation at home and abroad, and its geological characteristics, we call it shale oil in this paper, i.e. the Chang 7 Member of Yanchang Formation in the Ordos Basin shale oil refers to the oil accumulation in tight sandstone and shale in the Chang 7 Member source rocks, which was formed without a long-distance migration. Depending on lithologic association and other factors, the shale oil reservoirs are classified into 3 types as multiphase sand overlay type (type I), shale interbedded with thin sandstone type (type II) and pure shale (type III). According to the comprehensive geological study, Chang 7 shale oil is characterized by the following: sand-mud reservoir with large area distribution, dense reservoir with good fluidity, high oil saturation, light oil, high gas-oil ratio, shallow burial, and large quantity of resources, etc. In recent years, through seismic survey, well logging, research on engineering and development technologies, achievements on exploration and development of shale oil in Chang 7 Member are achieved, such as: defined the scale reservoir area of type I shale oil, and 3 pilot areas for horizontal well development of type I shale oil were constructed; for type II and type III shale oil, production of oil was achieved through vertical well exploration; the scale development of type I shale oil has achieved remarkable results, and shale oil of Chang 7 Member has become an important resource guarantee for the "second acceleration" development of Changqing oilfield.

The Fengcheng Formation in Mahu sag in the Junggar Basin is important for successive exploration of continental shale oil in China. In order to provide basic data for future exploration and deployment, and enrich continental shale oil accumulation theory, the geological characteristics and accumulation mechanism of the shale oil in the Fengcheng Formation were studied through comprehensive analysis of seismic, well logging, mud logging and well test data, core, source rock pyrolysis, and casting thin sections. The results show that the Fengcheng Formation is composed of mixed rocks depositing in an alkaline lake environment under the sedimentary control of mechanical, chemical, biological and volcanic activities. The Formation is divided into three lithologic members from the bottom to the top. Source rocks with algal organic matters can be found in the whole Formation. The most developed source rock interval is the developed sweet spot interval. The sweet spot interval and the source rock interval are interbedded or in the same interval. The Feng 1 and Feng 2 Members have sweet spots of silty sandstone and dolomite, and the Feng 2 Member has sweet spots of dolomite. The sweet spots are distributed in source rocks and alkaline mineral layers. Organic-rich source rocks, sedimentary microfacies, lithology and structural fractures control the accumulation and distribution of the shale oil.

Based on the description of 586m-long cores from 12 wells such as Lu1 and Ma56-12, and the analytical data of over ten thousand samples, the geological conditions and resource potentials of two types of unconventional Permian oil in the Santanghu Basin were analyzed, and supporting technologies were developed for economic exploration and development. The following study results were obtained: ① Unconventional Permian oil accumulated in the argillaceous source rock or the adjacent tuff reservoir depositing in the shallow- deep lake during intermittent volcanic activities. Two types of unconventional oil resources were discovered: tight oil of the Middle Permian Tiaohu Formation (P2t) and shale oil of the Lucaogou Formation (P2l). ②The Lucaogou Formation is the primary source rock dominated by argillaceous rock. The kerogen is type I-II2, TOC is generally more than 2%, and Ro ranges from 0.5% to 1.3%, indicating low maturity. ③ The reservoir is complex, composed of more sedimentary tuff and dolomitic tuff, and less tuffaceous dolomite and argillaceous dolomite. Brittle minerals are generally more than 70% and clay minerals are less than 10%. The reservoir space is dominated by intergranular micropores, intergranular micropores and dissolved micropores. The Tiaohu tight oil reservoir is of high porosity, low permeability and high oil saturation, while the Lucaogou shale oil reservoir has the similar permeability to the Tiaohu tight oil reservoir, but the porosity and oil saturation are generally lower than those of the Tiaohu tight oil reservoir. ④ The crude oil is medium to heavy, and the density is 0.850.90 g/cm3, the pressure coefficient is 1.01.4 (a common pressure system). The reservoir distribution is controlled by both good source rocks and effective reservoirs. Preliminary prediction shows that the unconventional Permian oil resources, mainly distributed in the Lucaogou Formation, and showing a great exploration potential. The central part of the Malang sag and the south-central part of the Tiaohu sag are important for expanding exploration and production. Exploration and development practice have proved that horizontal wells and volume fracturing stimulation are effective to produce the unconventional oil, and integration of exploration and development can guarantee the economic development of the unconventional oil.

Shale oil is a new hotspot in unconventional oil and gas exploration. Shale oil in the Liaohe depression is abundant and deemed to be one of the most significant successive resources. The Sha 4 Member in Damintun sag is composed of oil shale, argillaceous dolomite, carbonate-bearing oil shale, silt-bearing oil shale and siltstone. They have good hydrocarbon generating conditions and provide a material basis for shale oil resources. According to the geological conditions of the study area, a “three-quality” evaluation method for shale oil is proposed: ① Evaluate the quality of source rocks to determine oil enrichment zones; ② Considering factors such as crude oil viscosity, permeability and formation pressure, calculate the flow quality curve that characterizes reservoir permeability, and identify high-permeability zones; ③ Evaluate brittleness and fracturability, find engineering sweet spot zones, and select target fracturing zones by calculating brittle composition and analyzing geostress anisotropy. Test data of old wells and drilling data of new wells show that the Sha 4 Member in Damintun sag is favorable for shale oil exploration. Using the “three-quality” evaluation method to select sweet spot zones and conduct effective fracturing stimulation, it is helpful to constructing industrial capacity and approaching to a promising exploration future.

Shale oil in Mahu sag is an important exploration field in the Junggar Basin in recent years. Through core observation, rock slices, X-ray diffraction, scanning electron microscopy (SEM) and statistical analysis of physical and geochemical data, the reservoir characteristics and control factors of Permian Fengcheng Formation are studied. The analysis shows that the Permian Fengcheng Formation was formed in the saline lacustrine basin when the latter sedimented consistently, and two main sedimentary facies, fan delta and lake, were developed. The rock types are complex, and mainly in five types: terrigenous clastic rocks, dolomites and dolomitic rocks, organic rich shale, evaporites, volcanic rocks. There are many mineral components in the rocks, which are changed greatly in vertical direction, and searlesite, shortite, nahcolite and other uncommon alkaline minerals can be observed. The types of reservoir space are mainly vugs, intergranular pores, intercrystal pores and fractures, among which vugs and fractures are the favorable reservoir spaces, and are of dual medium structure of fractures-pores, which belong to micro-pore thin throat, low-porosity, low-permeability and ultra-low-permeability reservoirs. The control factors affecting the development of Fengcheng Formation shale oil reservoir mainly include the sedimentary environment and sedimentary facies, lithology, organic carbon content and the storage mode, alkaline mineral content, diagenesis and fractures, etc., among which sedimentary environment and sedimentary facies control the reservoir development scale and pore development in early stage; the fine siltstone, argillaceous siltstone and dolomite are of good reserve performance; organic carbon content was positively related with reservoir properties; the alkaline mineral content higher, the higher the reservoir porosity, dolomite diagenesis and dissolution decide the formation of secondary pores; under tectonic activities large quantities of fractures develop as reserve space and percolation channel, and this leads to the development of vugs around fractures, which plays a positive and constructive role in improving porosity, permeability and reservoir performance.

The hydrogen index IH and the original hydrogen index IHo, the most important parameters in the rock pyrolysis test, are critical indicators for measuring the hydrocarbon generation potential of source rocks. In view of the shortcomings of the existing IHo model, an improved model was proposed to deliver a higher coincidence between the calculated results and the measured values. Moreover, the quantitative model of parameters such as carbon recovery coefficient, original organic carbon content, convertible carbon content, convertible carbon percentage, conversion ratio, degradation ratio, hydrocarbon generation ratio, and original organic porosity, was derived. Based on the rock pyrolysis and TOC data of 1249 groups of rock samples in 7 basins around the world, the key parameters of IHo model for four types of source rocks with Type I, IIa, IIb and III organic matters were obtained by fitting, and the template that the parameters (e.g. hydrocarbon generation potential, carbon recovery coefficient, conversion ratio, degradation ratio, hydrocarbon generation ratio, and original organic porosity) change with Tmax was established for four types of source rocks. These models and templates supplement the existing quantitative research tools for effective source rocks, and are expected to promote the development of oil and gas resources evaluation technology.

The Kong 2 Member in the Cangdong sag, the Dagang exploration region, is typical continental shale oil reservoir. It can’t be fractured based on the applicable brittleness index model for marine shale oil reservoir at home and abroad. According to geological analysis and core triaxial test, a brittleness index model describing the whole deformed and damaged process of the rock was established for the shale oil reservoir in the Kong2 Member using the fractal method. Then based on the analysis of how natural fractures propagate, the method for calculating the influencing factors of natural fractures and geostress were defined, and finally a fracture network index model integrating rock brittleness, natural fractures and geostress was built for quantitative prediction of the fracturability of the shale reservoir. The model is used to build the fracturability index profile and optimize the cluster spacing, perforating and fracturing parameters of horizontal wells. And together with optimized slip water + low-damage fracturing fluid, and quartz sand + ceramsite proppants, the volume fracturing technology for shale oil horizontal wells was developed. The technological achievements have been applied in Wells GD1701H and GD1702H. And micro-seismic survey and stable electrical field monitoring have found complex fracture networks, indicating remarkable effect of increasing production.

The shale oil resource accumulation and development potential of the Lucaogou Formation (P2l) in Jimsar sag, Junggar Basin are huge. Since the production breakthrough of the horizontal well Ji 172_H, the volume fracturing technology has been tested on 10 horizontal wells with the goal of shale oil scale benefit development, but the production results have not reached the expected level. Through the geology-engineering integration, on the basis of determining the P2l22-2 lithic feldspar fine siltstone layer as the high-quality sweet spot and the clear recognition that high-quality sweet spot drilling rate is the geological guarantee of post-fracture high-yield, the restriction from the bedding plane and high-strength mudstone barrier to the vertical extension ability of the artificial fracture are analyzed, the differences of fracturing transformation parameters of the horizontal well which volume fracturing has been implemented are compared, and the technical countermeasures of intensive spacing and high intensity volume fracturing of horizontal wells for improving the production and efficiency are proposed. The development test well deployed in 2017 created a new production record with a maximum daily output of 108.3t and a total production of over 10,000 tons of oil in 240 days. In 2018, 10 horizontal wells were put in test and the average daily oil production was 50.4 tons. It is proved that the intensive spacing and high intensity volume fracturing of horizontal wells can effectively improve the single well production and achieve higher development benefits, which lays a solid technical foundation for the scale development of the Jimsar sag shale oil and provides a strong engineering support.