Shale Gas in China Great Expectations and the Challenges of Development

摘要

1. China has the largest reported resources of shale gas in the world but development of these has proven to be challenging and costlyrn2. The shale gas industry in China is growing but not at the pace originally targeted by the Central Governmentrn3. Companies like Sinopec and PetroChina have achieved some success in a number of project areas in Chongqing Municipality and Sichuan Provincern4. Other prospective regions have major challenges in terms of geology, geography and infrastructure to overcome in order to contribute to the country’s shale gas productionrn5. Sinopec and PetroChina will need to invest significant capital over the next 3 years to achieve the targeted production growthrn6. It will be difficult for the Central Government to achieve its shale gas production targets by 2020 (even after cutting them in half to 30 Billion m3/yr)rn7. Even if production targets are met, China will still be dependent on natural gas imports from either Russia (via pipeline) or LNG imports.