Beijing has invited foreign joint ventures to bid for shale gas exploration licences in a new tender process, a milestone policy change that will allow foreign energy companies to play a greater role in developing China’s rich potential reserves of shale gas.
China’s shale gas reserves are estimated to be the largest in the world, according to the US Energy Information Administration, and if successfully developed, could radically alter energy markets in the world’s biggest energy consumer. Shale gas is typically trapped in shale rock and extracted by cracking the rock open with highly pressurised water, a process known as hydraulic fracturing or “fracking”.
Yesterday China’s Ministry of Land and Resources announced its second tender for bids for shale gas blocks in southern China, following a smaller tender process last year that was limited to domestic companies and elicited a feeble response. The ministry said that Chinese-controlled foreign joint ventures would be allowed to bid in the tender process, which covers 20 shale gas blocks in southern China.