Dragon hunts for the Energy : Shale gas or Yeyanqi

Dragon want's to rise

USA sanction’s on iran does not seems to stop China from buying oil, in fact huge discounts are now available for them. But, China which is world largest consumer of oil and gas has their own plan.

Few days back standing at the ruling Communist party's annual congress, Premier said words yeyanqi which means shale Gas. China is trying hard to develop its biggest shale gas resources. Country wants to reduce the carbon emission by replacing coal from gas..

Silently crawling towards the aim

Sinopec recent $2.5bn deal with Devon of Oklahoma to invest in shale oil and gas projects in the US. China is putting lot of investment for development of its natural gas resources, It should able to develop full fledge production by 2020. It already started putting infrastructure in to use this energy so for now it should depend on import. Chevron, Shell, Stat oil, BP almost all major r putting lot of investment in for development of shale . Royal Dutch Shell says it has signed a deal with China National Petroleum Corp. to seek, develop and produce shale gas. production sharing contract is the first signed with China to exploit shale gas and covers a 3,500 square kilometer (1,350 square mile) region of the Sichuan Basin...

Wonder why Dragon is slow ?

China has a complex geology especially in Sichuan basin which contains huge gas resources but is highly fractured, making it difficult to drill horizontal well. Country also has scarcity of water resources keeping in mind fracking requires huge amount of water. Water issues and environmental concerns are already a issue of headache for shale gas producers. ..

Initial plans to conquer the Energy

There are at least 7 projects in my knowledge which are currently going in china as JV between National Oil and Fortune 500 companies. China has 5 LNG terminals, 7 or 8 under construction, 6 are approved. They are expecting 60 Billion cubic meter per year of gas from these terminals. According to Five year plan forecasted by 2015 there will be need 250 Billion cubic meter of gas by 2020 it is expected to rise to 400 Bcm and they want to produce 80 Bcm/yr by 2020 which is unrealistic ..

PS Wrote this article few months back, so didnt mention the CNOOC take over of Nexen. Kindly excuse me for my language skills, I am working towards it.