• 3 minutes Nucelar Deal Is Dead? Iran Distances Itself Further From ND, Alarming Russia And France
  • 5 minutes Don Jr. Tweets name Ukraine Whistleblower, Eric Ciaramella. Worked for CIA during Obama Administration, Hold over to Trump National Security Counsel under Gen McCallister, more . . . .
  • 9 minutes Shale pioneer Chesepeak will file bankruptcy soon. FINALLY ! The consolidation begins
  • 12 minutes China's Blueprint For Global Power
  • 9 hours EU has already lost the Trump vs. EU Trade War
  • 33 mins Science: Only correct if it fits the popular narrative
  • 3 hours Pioneer's Sheffield in Doghouse. Oil upset his bragging about Shale hurt prices. Now on campaign to lower expectations, prop up price.
  • 6 hours ''Err ... but Trump ...?'' *sniff
  • 2 hours China's Renewables Boom Hits the Wall
  • 1 hour What are the odds of 4 U.S. politicians all having children working for Ukraine Gas Companies?
  • 6 mins Crazy Stories From Round The World
  • 17 hours Who writes this stuff? "Crude Prices Swing Between Gains, Losses"
  • 2 hours Forget out-of-date 'dirty oil' smear, Alberta moving to be world's cleanest oil industry
  • 2 hours Tesla Launches Faster Third Generation Supercharger
  • 9 hours Passerby doused with flammable liquid and set on fire by peaceful protesters
  • 1 day Haaretz article series _ Saudi Arabia: A Kingdom in Turmoil | Part 1 - Oil Empire

Breaking News:

Russia Plans To Boost Crude Oil Exports

Alt Text

Top U.S. Gas Producer Looks To Ditch Major Shale Assets

Shale icon Chesapeake is reportedly…

Alt Text

The Birth Of An LNG Superpower

Iran’s rapprochement with Qatar and…

Jen Alic

Jen Alic

 

More Info

Premium Content

US Companies Poised to Launch Chinese Shale Boom

US-based ConocoPhillips has cut a deal with China’s Sinopec to jointly study shale gas development in China, where the US company’s hydraulic fracturing is in high demand.

Last week, China’s Sinopec Group announced that ConocoPhillips (COP) would jump on board in the Sichuan Basin in a two-year deal to conduct exploration research and develop shale gas production.

The Sichuan Basin is believed to contain vast amounts of deeply embedded shale gas, and Beijing is on the fast track to boost its shale gas and tight natural gas reserves as part of its strategy to increase its reliance on cleaner fuel.

The situation is urgent for China, which is in the running for the world’s third-largest consumer of natural gas—just behind the US, Russia and Iran. But China lacks the fracking technology and experience that has pushed along the shale revolution in the US.

Related Article: Why the US should not Invest in Exporting Natural Gas

Sinopec is the China National Petroleum Corp, and ConocoPhillips signed the join research deal with Sinopec subsidiary, Sinopec Exploration Southern Company. Research will be conducted in the Sichuan Basin’s Qijang block and will involve the conducting of seismic surveys and the drilling of two wells.

ConocoPhillips is the third major international company to join in the China shale play. Earlier in December, Royal Dutch Shell Plc signed a deal with Sunwing Zitong Energy Limited—a wholly-owned subsidiary of Canada’s Ivanhoe Energy Inc. to acquire 100% of the company’s interests in the Zitong natural gas block in Sichuan. Beijing has already approved the deal.

Related Article: EXCLUSIVE: Beijing Sinking Teeth into Western Turf in Asia

At the same time, Shell also signed a production-sharing agreement with Sinopec and Mitsubishi Gas Chemical Company Inc. Shell is the operator and holds 90% interest, with 10% for Mitsubishi during exploration and development. The Zitong block is just over 1,000 square kilometers north of the Junqiu block in the Sichuan Basin.

If it had the technology, China would quickly overtake North America in terms of shale gas. Its reserves are probably greater than those of the US and Canada combined. According to the US Energy Information Administration (EIA) in just two basins alone—Sichuan and Tarim—there are some 1,275 trillion cubic feet (36 trillion cubic meters) of recoverable shale gas.

Yet, it lags far behind in terms of development, let alone production. Geologically it’s a bit tricky, and the water resources necessary for fracking aren’t there—so that’s an expense for anyone involved in development. However, with foreign companies with the right technology and experience entering into play, the prospects are very attractive—though payout is years away.

By. Jen Alic of Oilprice.com




Download The Free Oilprice App Today

Back to homepage



Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play