Ningbo Safewell Plumbing Co., Ltd. , https://www.safewellbrass.com
In response to the growing demand for clean and sustainable energy, China has taken a significant step forward in the development of shale gas. Following the State Council’s official recognition of shale gas as a new mineral resource, the Ministry of Land and Resources recently issued a Notice aimed at strengthening the exploration, development, and supervision of shale gas resources. This move comes at a crucial time, as it seeks to accelerate the standardization and expansion of the industry.
Shale gas, a form of natural gas extracted from shale formations, offers long-term production potential and is increasingly seen as a key supplement to traditional energy sources. With rising global energy demands, countries around the world—especially the United States, which leads in shale gas development—have been investing heavily in this sector. China, with its vast reserves, is now stepping up efforts to tap into this resource.
Currently, China's shale gas exploration is still in its early stages, but preliminary assessments indicate a huge resource potential. If developed effectively, shale gas could play a vital role in reducing the country's reliance on imported oil and gas, reshaping its overall energy landscape. According to data from the Ministry of Land and Resources, by 2020, China's annual natural gas consumption is expected to reach 300 billion cubic meters. If shale gas can contribute 100 billion cubic meters, it would significantly enhance energy security.
The newly issued "Notice" aims to promote market-driven development while ensuring orderly growth. It encourages various investment entities to participate in the sector, following legal procedures. The notice emphasizes the importance of open access, allowing independent enterprises to apply for exploration rights if they meet certain criteria, or collaborate with qualified geological units if they lack specific qualifications.
To address challenges such as speculative land grabbing and inadequate exploration, the notice introduces a commitment system. Applicants must commit to their exploration responsibilities, including financial investment, workload, and progress. Provincial and national-level oversight will ensure that these commitments are met, promoting transparency and accountability.
According to the Ministry of Land and Resources, China has identified 25 trillion cubic meters of recoverable shale gas resources, with 180 favorable blocks covering 1.11 million square kilometers. Notably, 77% of these areas overlap with existing oil and gas blocks, highlighting the potential for integrated development.
In response, the notice encourages the exploration of shale gas within existing oil and gas blocks. It promotes a phased approach: first, encouraging oil companies to explore and develop shale gas in their own areas; second, allowing transfer of rights to other investors if oil companies do not act; and third, requiring oil companies to withdraw from blocks where shale gas potential exists but oil and gas exploration is insufficient.
Despite the high costs and risks involved, the notice includes several supportive measures, such as reduced mining fees, improved land use policies, and enhanced technological research. These steps aim to create a more favorable environment for shale gas development, paving the way for long-term growth and sustainability in China's energy sector.