China eager to tap huge shale gas reserves
This article by Aizhu Chen of Reuters touches on some of the points concerning energy supplies covered by Fullermoney in recent months. Here is the opening:
China has spent tens of billions of dollars buying into energy resources from Africa to Latin America to slake the unquenched thirst for fuel from its growing industry and burgeoning cities. But the country may have more energy riches under its own soil than policy makers ever dared imagine.Back to top
A little more than a year ago, Beijing awakened to a technology revolution that has unlocked huge reserves of natural gas trapped within shale rock formations in the United States.
Once deemed too costly to extract, shale gas has turned around U.S. dependence on foreign natural gas imports. Its shale gas reserves alone are estimated to be big enough to meet domestic demand for 30 years. This is an American dream that China wants to emulate.
``America's shale gas production alone has exceeded that of total Chinese gas output. That gives us a lot of confidence,'' said Zhang Dawei, deputy director of the Strategic Research Center for Oil and Gas in the Ministry of Land and Resources.
China's confidence has been bolstered by a new report of its estimated reserves of shale gas, which shows them to be by far the largest in the world.
The U.S. Energy Information Agency estimated in a report last month that China holds 36.1 trillion cubic meters of technically recoverable shale gas reserves -significantly higher than the 24.4 trillion cubic meters in the United States, which has the second-largest amount.
China's imminent shale rush comes at a critical point. It will soon overtake the United States as the world's top energy user and is already the world's biggest coal burner and the biggest emitter of carbon dioxide.
Beijing's bureaucrats thus face a daunting challenge: how to clean up China's brown skies while meeting the world's fastest-growing energy demand.
Natural gas burns more cleanly than other fossil fuels, and installing gasfired power generation is cheaper and easier than building nuclear plants. The problem is that China cannot meet its rising demand with its limited reserves of conventional natural gas.
Shale gas may not be as clean as advertised, according to a study released last week by Cornell University in New York State. The study argued that significant amounts of methane -a potent greenhouse gas -escape into the atmosphere during production in wells and distribution in pipelines.
Regardless, China is racing to find out how much shale gas it can exploit -and how quickly it can get the technology and build the infrastructure it needs to pump it to market -to reduce its dependence on foreign sources of natural gas. China has identified shale gas as one of the country's top targets for technological breakthroughs in its next five-year plan.
The Ministry of Land and Resources said it would hold the first auction of shale gas blocks any day now, after having delayed it a couple of times previously. The auction is for eight explora tion blocks covering 18,000 square kilometers, or 7,000 square miles, in four inland areas: Sichuan and Guizhou provinces and Chongqing Municipality, all in the country's southwest, and Hubei Province, in the center of the country.
Experts say shale, which needs intensive drilling and many wells, plays to China's strengths.