National and Global Petroleum Assessment

Assessment of Permian Tight Oil and Gas Resources in the Junggar 

Basin of China, 2016

U.S. Department of the Interior

U.S. Geological Survey

Fact Sheet 2017–3021

April 2017

Using a geology-based assessment methodology, the U.S. Geological Survey estimated undiscovered, technically recoverable mean 

resources of 764 million barrels of oil and 3.5 trillion cubic feet of gas in tight reservoirs in the Permian Lucaogou Formation in the 

Junggar basin of northwestern China.

Introduction

The U.S. Geological Survey (USGS) quantitatively assessed the potential for continuous 

(unconventional) oil and gas resources within 

organic-rich shale and associated tight reservoirs 

in lacustrine deposits of the Junggar basin of 

China (fig. 1). The assessed stratigraphic interval 

was laminated, organic-rich shale of the Lower 

Permian Lucaogou Formation (Yang and others, 

2010; superseding an Upper Permian age assigned 

by previous researchers, such as Carroll and 

others, 1992). The Permian lacustrine formations 

of the Junggar basin were likely deposited in a 

foreland basin north of a north-directed thrust belt 

in the Tian Shan at the basin’s southern margin 

(fig. 1) (Wartes and others, 2002). The Junggar 

was an intracratonic sag basin in the Mesozoic 

and Paleogene and is again in a foreland setting in 

Neogene to present time (Bian and others, 2010).

The focus of this assessment is the potential 

for oil and gas retained in tight reservoirs interbedded within the Permian Lucaogou lacustrine 

shales. Tight reservoirs are generally considered 

to be nonshale reservoirs that require artificial 

stimulation such as hydraulic fracturing to produce hydrocarbons because of low permeability 

of the reservoir (generally near 0.1 millidarcies 

or lower, criteria met by the Lucaogou reservoirs 

according to Cao and others, 2016). Current 

exploration and production of tight oil from the 

Lucaogou Formation are focused on the Jimusar 

sag, a relatively shallow part of the basin (fig. 1). 

At present, there are 16 wells producing “industrial tight-oil flows” from the Lucaogou in the 

Jimusar sag (Hu and others, 2016). 

Within the Permian Lucaogou Total 

Petroleum System, we defined two assessment 

units (AUs): the Permian Lucaogou Continuous 

Oil AU and the Permian Lucaogou Continuous 

Gas AU (fig. 1). The thickness, organic matter 

content and type, and thermal maturity of the 

Lucaogou all suggest the potential to produce 

continuous oil and gas. The Permian Lucaogou 

Continuous Oil AU corresponds to areas where 

the Lucaogou Formation is currently at depths 

shallower than 5 kilometers on shelves around the margins of the basin (for example, 

Jimusar sag; fig. 1). Gradual burial of the basin’s shelves and shallow marginal sags 

led to oil being generated in the Permian Lucaogou Formation in the Late Jurassic 

to middle Cretaceous (Kuang and others, 2012). The Permian Lucaogou Continuous 

Gas AU corresponds to the areas where organic-rich shale lies at depths greater than 

5 kilometers. This part of the basin experienced voluminous nonmarine sedimentation nearly continuously from the Permian to the Neogene. Oil was generated in latest 

Permian and earliest Triassic (Kuang and others, 2012) and cracked to gas later in the 

Mesozoic. Continuous oil and gas accumulations in the United States were used as 

analogs in this assessment. Table 1 lists principal input data for the assessment. 

KAZAKHSTAN

CHINA

MONGOLIA

Tacheng

Jinghe

Karamay

Shihezi

Changji

Ertai

Altay

Tian Shan 

Bogda Shan

Jimusar

 sag

Ürümqi

0 25 50 75 MILES

0 5025 75 KILOMETERS

Source: U.S. Department of the Interior National Park Service

82° 84° 86° 88° 90°

46°

44°

42°

BAY OF

BENGAL

SOUTH

CHINA

SEA

EAST

CHINA

SEA

CHINA

MONGOLIA

KAZAKHSTAN Map area EXPLANATION

Junggar basin

Permian Lucaogou Continuous Gas AU

Permian Lucaogou Continuous Oil AU

Figure 1. Location of the two assessment units (AUs)

in the Junggar basin, China. 
ISSN 2327-6916 (print) ISSN 2327-6932 (online) https://doi.org/10.3133/fs20173021

For More Information

Assessment results are available at the USGS Energy Resources 

Program website at http://energy.usgs.gov/.

Junggar Basin Assessment Team

Christopher J. Potter, Christopher J. Schenk, Marilyn E. 

Tennyson, Timothy R. Klett, Stephanie B. Gaswirth, Heidi M. 

Leathers-Miller, Thomas M. Finn, Michael E. Brownfield, Janet K. 

Pitman, Tracey J. Mercier, Phuong A. Le, and Ronald M. Drake II

Undiscovered Resources Summary

The USGS quantitatively assessed the Permian Lucaogou Continuous Oil AU and the Permian Lucaogou Continuous Gas AU 

within the Permian Lucaogou Total Petroleum System in the Junggar basin, northwest China (table 2). The mean total for continuous 

oil resources is 764 million barrels of oil (MMBO) with an F95–F5 range from 171 to 1,675 MMBO. The mean total for continuous gas 

resources is 3,465 billion cubic feet (BCFG) with an F95–F5 range from 633 to 9,123 BCFG. The mean total for natural gas liquids is 

66 million barrels of natural gas liquids (MMBNGL) with an F95–F5 range from 11 to 178 MMBNGL. These estimates are for undiscovered, technically recoverable resources of oil, gas, and natural gas liquids and do not reflect economically recoverable resources.

Table 1. Key assessment input data for two continuous assessment units in the Junggar basin, China.

[AU, assessment unit; %, percent; EUR, estimated ultimate recovery per well; MMBO, million barrels of oil; BCFG, billion cubic feet of gas. The average EUR input is 

the minimum, median, maximum, and calculated mean. Shading indicates not applicable]

Assessment input data Permian Lucaogou Continuous Oil AU Permian Lucaogou Continuous Gas AU

Minimum Mode Maximum Calculated mean Minimum Mode Maximum Calculated mean

Potential production area of AU (acres) 1,000 1,300,000 2,671,000 1,324,000 1,000 3,000,000 6,300,000 3,100,333

Average drainage area of wells (acres) 40 80 120 80 80 120 160 120

Percentage of area untested in AU 100 100 100 100 100 100 100 100

Success ratios (%) 10 50 90 50 10 50 90 50

Average EUR (MMBO, oil; BCFG, gas) 0.04 0.085 0.2 0.091 0.08 0.2 1.2 0.256

AU probability 1.0 1.0

Table 2. Assessment results for two continuous assessment units in the Junggar basin, China. 

[MMBO, million barrels of oil; BCFG, billion cubic feet of gas; NGL, natural gas liquids; MMBNGL, million barrels of natural gas liquids. Results shown are fully 

risked estimates. For gas accumulations, all liquids are included in the NGL category. F95 represents a 95-percent chance of at least the amount tabulated; other fractiles 

are defined similarly. Fractiles are additive under the assumption of perfect positive correlation. Shading indicates not applicable]

Total petroleum system and

assessment units (AUs)

AU

probability

Accumulation

type

Total undiscovered resources

Oil (MMBO) Gas (BCFG) NGL (MMBNGL)

F95 F50 F5 Mean F95 F50 F5 Mean F95 F50 F5 Mean

Permian Lucaogou Total Petroleum System

Permian Lucaogou Continuous Oil AU 1.0 Oil 171 675 1,675 764 45 192 542 230 0 1 2 1

Permian Lucaogou Continuous Gas AU 1.0 Gas 588 2,448 8,581 3,235 11 48 176 65

Total undiscovered continuous resources 171 675 1,675 764 633 2,640 9,123 3,465 11 49 178 66

References Cited

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