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Running on Empty
China's Thwarted Gas Ambitions

Coal is the source of many of China’s headaches these days. The fossil fuel is one of the cheapest options for producing consistent baseload power, but it carries with it a heavy environmental cost in terms of greenhouse gas emissions and in local air pollution. China is attempting to wean its appetite on the sooty stuff (it accounts for roughly half of the world’s consumption) by boosting consumption of natural gas, which emits roughly half as much carbon as coal. That potential solution is fraught with difficulties, however, as the New York Times reports:

China’s ability to extract sufficient natural gas is in serious doubt. Despite heavy investment and strong government support, China’s natural gas production is growing at a slower pace than its decelerating economy. China’s production of natural gas increased just 6 percent last year and 4.4 percent in 2012.

China’s main problem is that shale gas production has fallen far short of expectations. That has left the country relying on alternative methods considered also-rans by American standards, like pumping natural gas from coal fields.

But extracting natural gas from coal seams is no picnic:

Cracks in the subterranean coal are flooded with water that needs to be pumped out before the gas will emerge. The coal seams are so cold that gels injected into the well, which are meant to help release the gas, sometimes become gummy and block the flow instead. And there is constant concern about hitting the labyrinths of active coal mines that honeycomb the area.

China’s struggles to develop its shale gas reserves, the largest in the world, are well documented. The country lacks everything that made shale take off in America: simple geology, pipeline infrastructure, water resources, a large pool of capital and the investors willing to take risks on unproven plays, and the technical expertise to drill horizontal wells and frack successfully.

To help alleviate the toxic smog blanketing its major cities (a problem that is only getting worse), China plans to build more than sixty plants that will convert coal into natural gas. The plants will be sited in rural areas, which should help clear the skies of China’s megacities, and will produce electricity and natural gas to be consumed in urban areas. But this solution, too, has its problems. Researchers estimate that these plants will produce between 36 and 82 percent more greenhouse gas emissions than traditional coal power plants. Then, too, there are the costs of transmitting the gas produced from the hinterlands to the cities. In other words, there are high premiums, both environmental and economic, involved in outsourcing coal energy production to the countryside.

China is pursuing another natural gas option, as well: boosting imports. But this, too, carries with it a number of costs and risks that Beijing’s leaders will want to minimize. In today’s world, the more of your energy needs you can meet with domestic supplies, the better insulated you are from disruptions, and the more foreign policy options you have available. China wants a homegrown natural gas boom for good reasons, but it’s proving mighty difficult to pull off thus far.

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  • Jacksonian_Libertarian

    “China is pursuing another natural gas option, as well: boosting imports. But this, too, carries with it a number of costs and risks that Beijing’s leaders will want to minimize.”

    I doubt China’s leaders really think beyond what is best for themselves. You don’t threaten all your neighbors with territorial ambitions, when those same neighbors sit on your shipping lanes, and can easily cut off all your imports and exports. More than any other country, 40% of China’s economy is dependent on foreign trade. Losing their trade routes would therefore devastate China’s economy, so why are they doing it? Because China’s leadership can’t see past the lining of their own pockets, and they’ve all prepared their friends and families for a swift exit to better places. Those that can see the writing on the wall, realize that the US has beaten them by uplifting the Chinese people out of abject poverty. And the moment the Chinese people find their incomes going down and realize how the Communist Party has hosed them, there will be a bloody revolution.

  • Duperray

    “US has beaten them by uplifting the Chinese people out of abject poverty”: Fantastic ! So, since 1949 up to now, the chinese level of life increase is exclusively due to US ?

    The entire World smiles when it sees US citiziens to be so over confident in every matter.
    Same a in 1940. Then came 1941 Dec 7th…

    • Dan

      and then comes August 6, 1945

  • Josephbleau

    China will remain communist as long as it can provide a higher paying government job to everyone who shows initiative and resourcefulness. The underground needs smart people. Potential threats must be trapped in the web of government graft, we forget that the system if informers in China is very deep, the state knows who is who. Kulaks must move the party forward or move to Siberia. Chinese culture demands high investment in children and great damage is done when the little princes of high officials get all the university slots and the good jobs.

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