China is poised to become the world’s largest producer of shale gas, though that might take a few decades. Still, test drilling has confirmed the Chinese are sitting atop the world’s largest reserves of the unconventional natural gas resource. The FT reports:
PetroChina, the listed subsidiary of Chinese oil and gas producer CNPC, told the Financial Times it had drilled about 20 wells in its shale gas acreage in southern Sichuan province and that initial results had been positive. “The wells are producing more than 10,000 cu m of gas per well per day,” said Mao Zefeng, PetroChina senior assistant secretary to the board. “We are still assessing the exact size of the potential reserves.”China does not yet have any shale gas wells producing commercially, but several companies have exploratory projects underway, including Sinopec, PetroChina, Royal Dutch Shell, BP and Chevron. China has more shale gas reserves than any other country in the world, with 1,275tr cu ft of recoverable shale gas reserves, according to estimates from the US Energy Information Administration. That is enough to supply China for more than 300 years, based on current consumption levels.
This is good news for almost everyone. Energy competition across the globe will be less dire: both the US and China have vast reserves of homegrown shale gas. Thankfully, vast reserves of energy resources at home make armed conflict over resources abroad far less likely.Moreover, current energy exporting countries — often unstable or misguided — will have less clout in the global energy market. China, long a supporter of repressive regimes in petro-states, will — in the future — be able to supply much of its energy needs at home. The US will too. This will reduce the influence and income of states like Iran, which sends much of its oil and gas to China. This is also one more piece of bad news for Russia; with Europe, the US and China all finding more gas at home, the world’s energy map is changing in ways that could make things a little more stable.