U.S. Department of the Interior

U.S. Geological Survey

Fact Sheet 2019–3012

June 2019

National and Global Petroleum Assessment

Assessment of Tight-Oil and Tight-Gas Resources in the 

Junggar and Santanghu Basins of Northwestern China, 2018

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

of 241 million barrels of tight oil and 10.1 trillion cubic feet of tight gas in the Junggar and Santanghu Basins of northwestern China. 

Introduction

In 2018, the U.S. Geological Survey (USGS) quantitatively assessed 

the unconventional (continuous) oil and gas resources in two previously 

unassessed formations in northwestern China. These include an assessment of tight-oil resources in the lower Permian Lucaogou Formation 

(Yang and others, 2010) of the Santanghu Basin (Altay-Sayan Folded 

Region Province) and tight gas in the Lower Jurassic Badaowan Formation 

(Guo and others, 2014; Yang and others, 2015) in the southern part of the 

Junggar Basin (Junggar Basin Province) (fig. 1). 

Lacustrine mudstones of the Lucaogou Formation are present in 

several basins and intervening uplifts in northwestern China (Carroll and 

Wartes, 2003). Tight oil is produced from this formation in the Junggar 

Basin, and in 2016, the USGS completed an assessment of tight-oil and 

tight-gas resources in the Lucaogou of the Junggar Basin (Potter and others, 

2017). Over the past 15 years in the Santanghu Basin, oil has been discovered and produced from several types of tight reservoirs in the Lucaogou 

Formation; this oil has apparently undergone short-distance vertical migration from interbedded organic-rich mudstone (Hackley and others, 2016). 

The thick Lower Jurassic Badaowan Formation in the southern 

Junggar Basin represents a fluvial and shallow lacustrine system containing 

low-permeability channel sandstones interbedded with coal and carbonaceous 

shale. Guo and others (2014) indicate that the tight sandstone layers 

and lenses contain a significant gas resource sourced mainly from the 

coals—a geologic framework that is very similar to that of major tight-gas 

fields in the western United States. In the southern Junggar Basin, natural 

gas has been discovered in coal and shale within the Badaowan (Petromin 

Resources, 2009); possible resource exploration concepts include tight 

gas, shale gas, and coalbed gas (Guo and others, 2014). This 2018 USGS 

assessment focused on tight-gas resources in sandstone that are analogous 

to tight-gas sandstones in the Upper Cretaceous Mesaverde Group in the 

Piceance Basin, Colorado (Johnson and Roberts, 2003; Cumella, 2009). 

Assessment Units

The USGS defined two assessment units for this study. The Santanghu 

Permian Lucaogou Continuous Oil Assessment Unit (AU) is within the 

Permian Lucaogou Total Petroleum System of the Santanghu Basin (AltaySayan Folded Region Province), and the Lower Jurassic Badaowan Tight 

Gas AU is within the Jurassic Total Petroleum System in the Junggar Basin 

(Junggar Basin Province).

Santanghu Permian Lucaogou Continuous Oil Assessment Unit

The Permian Lucaogou Formation was deposited in northwest China 

within one of the world’s largest known Phanerozoic lake basins, which 

was disrupted in the early Mesozoic Era by reverse faulting that produced 

mountainous uplifts and divided the formerly extensive lake system into 

several smaller basins (Carroll and Wartes, 2003). These basins, including the 

Santanghu and Junggar (fig. 1), have accumulated kilometers of Mesozoic 

and Cenozoic nonmarine sediment. 

The Lucaogou Formation in the Santanghu basin is 0–350 meters (m) 

thick (Liu and others, 2017) and includes rich lacustrine source rock in the 

Tiaohu and Malang sags in the central part of the basin (Liang and others, 

2014; Liu and others, 2018). The Santanghu Permian Lucaogou Continuous 

Oil AU (fig. 1) encompasses the area of these two sags. Oil has migrated 

vertically from the organic-rich mudstones and can be produced from 

interbedded tight sandstones, dolomitic mudstones, tuffaceous dolomites, and 

carbonates in the Lucaogou as well as from tuffs in the directly overlying 

Tiaohu Formation (Liang and others, 2014; Hackley and others, 2016). 

Reuters (2012) reported subeconomic quantities of oil in 15 of 35 PetroChina 

wells and commercial flow rates in 4 wells; Liang and others (2014) reported 

industrial oil flows from Tiaohu tuffaceous reservoirs in at least 5 wells. 

The lacustrine mudstone of the Lucaogou records a transition from a 

shallow, anoxic, stratified saline environment to a deep freshwater lake 

based on petrographic and geochemical analyses (Liu and others, 2017). 

The mudstone is dolomitic, and an upsection decrease in dolomite is 

consistent with decreasing salinity (Hackley and others, 2016). The average total organic carbon is 6.4 weight percent with a maximum measured 

value of 18 weight percent (Liu and others, 2012), and organic matter is 

predominantly Type I (Hackley and others, 2016). Vitrinite reflectance 

(Ro

; 0.5–1.0 percent) and organic geochemical analyses indicate that 

the Lucaogou is within the initial part of the oil-generation window 

(Liu and others, 2017). Liu and others (2012) concluded that it began 

to generate oil at the end of the Cretaceous. The Lucaogou Formation 

is overpressured (pressure coefficients of 1.1–1.2), likely because of 

hydrocarbon generation and rapid burial (Liu and others, 2012). 

KAZAKHSTAN

RUSSIA

CHINA

MONGOLIA

Ürümqi

Shihezi

Altay

Santanghu

ALTAY-SAYAN

FOLDED REGION

PROVINCE

JUNGGAR BASIN

SANTANGHU BASIN

82° E 84° E 86° E 88° E 90° E 92° E 94° E

48° N

46° N

44° N

Base map from U.S. Department of the Interior National Park Service

0 100 200 KILOMETERS

0 100 200 MILES

EXPLANATION

Province boundary

Lower Jurassic Badaowan

 Tight Gas AU

Santanghu Permian Lucaogou

 Continuous Oil AU

Map

area

KAZ

RUS

UZB

AFG

PAKIND

KGZ

TJK

MNG

CHN

ALTAY-SAYAN

FOLDED REGION

PROVINCE

JUNGGAR BASIN

SANTANGHU BASIN

Figure 1. Map showing locations of the Santanghu Permian Lucaogou Continuous

Oil Assessment Unit (AU) within the Santanghu Basin (Altay-Sayan Folded Region 

Province) and the Lower Jurassic Badaowan Tight Gas AU within the Junggar Basin 

(Junggar Basin Province). Approximate Santanghu Basin boundary (part) is also shown.
Lower Jurassic Badaowan Tight Gas Assessment Unit

In the southern part of the Junggar Basin, interbedded fluvial sandstones, 

carbonaceous shales, and coal of the Lower Jurassic Badaowan Formation 

are at current depths of 4–7 kilometers, achieving thermal maturities of 

0.5–2.2 percent Ro (Guo and others, 2014). The gross thickness of the formation ranges from 0 to 800 m (Yang and others, 2015). The average total organic 

carbon values of Badaowan coal beds and carbonaceous shales are 60 and 

1.7 weight percent, respectively, and the kerogen is predominantly Type III 

(Guo and others, 2014). According to the petroleum-generation-potential 

modeling of Guo and others (2014), the Badaowan source rocks generated 

gas in the Late Cretaceous to Neogene with peak generation in the Paleogene 

and Neogene. Specific timing would have varied with location and depth in 

the strongly asymmetric, southward-thickening basin. 

The Lower Jurassic Badaowan Tight Gas AU (fig. 1) includes the area 

where Ro

 is greater than 0.8 percent (Guo and others, 2014), corresponding to 

the approximate maturity threshold for thermogenic methane generation from 

coal (Tang and others, 1996). The assessment unit is bounded on the south by 

the northern edge of the fold and thrust belt that strongly deforms the southern 

margin of the basin. The Badaowan within this area is hundreds of meters thick 

(gross thickness; Yang and others, 2015), so thickness is not a limiting factor. 

Table 1 lists the principal input data used for the Lucaogou and 

Badaowan assessments. Continuous oil and gas accumulations in the United 

States were used as analogs. 

Undiscovered Resources Summary

The USGS quantitatively assessed continuous oil and gas resources 

in two assessment units in northwest China—one each in the Junggar and 

Santanghu Basins (table 2). In these two assessment units, the estimated 

mean total for continuous oil resources is 241 million barrels of oil (MMBO) 

with an F95–F5 range from 55 to 527 MMBO. The estimated mean total for 

continuous gas resources is 10,109 billion cubic feet (BCFG), or 10.1 trillion 

cubic feet of gas, with an F95–F5 range from 2,239 to 22,274 BCFG. The 

estimated mean total is 201 million barrels of natural gas liquids (MMBNGL) 

with an F95–F5 range from 42 to 465 MMBNGL. These resource estimates 

are for undiscovered, technically recoverable oil, gas, and natural gas liquids 

and do not reflect volumes of economically recoverable resources.

Table 1. Key input data for two continuous assessment units in northwestern China.

[AU, assessment unit; %, percent; EUR, estimated ultimate recovery per well; MMBO, million barrels of oil; BCFG, billion cubic feet of gas. Well drainage area, success ratio, and EUR are 

defined partly using U.S. tight-oil and tight-gas analogs. The average EUR input is the minimum, median, maximum, and calculated mean. Shading indicates not applicable]

Assessment input data—

Continuous AUs

Santanghu Permian Lucaogou Continuous Oil AU Lower Jurassic Badaowan Tight Gas AU

Minimum Mode Maximum Calculated mean Minimum Mode Maximum Calculated mean

Potential production area of AU (acres) 1,000 400,000 854,000 418,333 1,000 2,000,000 4,486,450 2,162,483

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

Success ratio (%) 10 50 90 50 10 50 90 50

Average EUR (MMBO, oil; BCFG, gas) 0.04 0.085 0.2 0.091 0.2 0.7 1.5 0.734

AU probability 1.0 1.0

Table 2. Results for two continuous assessment units in northwestern 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. 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 systems 

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 (Santanghu Basin)

Santanghu Permian Lucaogou 

Continuous Oil AU 1.0 Oil 55 213 527 241 14 61 170 72 0 0 1 0

Jurassic Total Petroleum System (Junggar Basin)

Lower Jurassic Badaowan Tight 

Gas AU 1.0 Gas 2,225 8,784 22,104 10,037 42 171 464 201

Total undiscovered continuous resources 55 213 527 241 2,239 8,845 22,274 10,109 42 171 465 201

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Northwest China Assessment Team

Christopher J. Potter, Christopher J. Schenk, Tracey J. Mercier, Marilyn E. Tennyson,

Thomas M. Finn, CherylA. Woodall, Heidi M. Leathers-Miller, Kristen R. Marra, PhuongA. Le,

Ronald M. Drake II, Michael E. Brownfield, and Janet K. Pitman

For More Information

Assessment results are also available at the USGS Energy Resources Program 

website at https://energy.usgs.gov.

ISSN 2327-6916 (print) ISSN 2327-6932 (online) https://doi.org/10.3133/fs20193012