China has established its first national shale oil demonstration zone in a continental faulted lake basin at the Shengli Jiyang oilfield in Shandong Province, marking a major step in domestic shale oil development.

The project achieved annual output of more than 700,000 tonnes in 2025 and has proven geological reserves of 327 million tonnes, according to the National Energy Administration.

The Shengli Jiyang zone is China’s third national-level shale oil demonstration area, following projects in Xinjiang and Heilongjiang.

It aims to advance shale oil exploration technologies, overcome technical challenges and develop efficient production models that can be replicated nationwide.

Shale oil, extracted from shale rock formations, is considered a significant energy resource with reserves exceeding conventional oil resources. China’s shale oil production surpassed 8.5 million tonnes in 2025, more than ten times the level recorded in 2018. -OGN/TradeArabia News Service