Exploring a \"Chinese path\" for shale gas development”

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Seeking breakthroughs in technology, policies, and pricing mechanisms At the Global Unconventional Natural Gas Summit that concluded in Beijing on November 8, participants noted that for China, the large-scale development of unconventional natural gases such as shale gas must be based on economic viability and environmental sustainability. It is necessary to find breakthroughs in areas such as pricing mechanisms, technological innovation, international cooperation, and supportive policies, in order to establish a development path suitable for China’s conditions. 　　**Yang Lei, deputy director of the Petroleum and Natural Gas Department at the National Energy Administration, said at the meeting that China has successively issued various plans for unconventional natural gas, and development goals for such gas have been established. “During the 12th Five-Year Plan period, China aims to determine that the geological reserves of shale gas amount to 600 billion cubic meters, with recoverable reserves of 200 billion cubic meters ； By 2015, shale gas production was to reach 6.5 billion cubic meters, and by 2020 it was to reach 60–100 billion cubic meters. He pointed out that the distribution areas of shale gas and conventional natural gas often overlap, and their transportation and utilization methods are the same; therefore, the development of shale gas should be integrated with that of conventional natural gas. At the same time, the development of shale gas must focus on efficiency and sustainability. To this end, it is necessary to explore market-based pricing mechanisms for gas prices, encourage international exchanges and cooperation, prioritize environmental protection and safety, strengthen policy support and guidance, and take multiple approaches to promote the development of shale gas. 　　Zhang Dawei, director of the Mineral Resources Reserve Evaluation Center under the Ministry of Land and Resources, admitted that China faces both opportunities and challenges in the development of shale gas resources. It is estimated that by 2020, domestic natural gas consumption will reach 380 billion cubic meters, while domestic production of conventional natural gas will be 200 billion cubic meters, resulting in a supply-demand gap of 180 billion cubic meters. This represents a significant opportunity for the development of shale gas. However, the development of shale gas also faces a series of challenges, such as the need to overcome key technical barriers, the absence of appropriate support policies, and the need to improve the management system. 　　Faced with this situation, Zhang Dawei said that **top-level design at the strategic level is necessary. All types of investment entities should have equal access to the shale gas sector, which requires comprehensive planning in terms of systems, mechanisms, strategies, policies, production, operation, and supervision. Zhang Dawei suggests fully opening up the shale gas market, carrying out investigations, evaluations, and basic research; formulating standards for resource identification, exploration and development procedures, technical and reserve assessment systems, as well as parameters for economic and environmental impact assessments; establishing demonstration projects for shale gas; strengthening the joint responsibility mechanism among the central government, local authorities, and enterprises in terms of the comprehensive utilization of mineral resources; implementing incentive policies; and opening up the market for technical services. He emphasized that there is still a long way to go in developing shale gas in our country, and in this process we need to learn from foreign experiences, but we cannot simply copy them. 　　Hu Wenrui, an academician of the Chinese Academy of Engineering, said in an interview with reporters that China is still in the initial stage of shale gas development. The development of shale gas should proceed step by step, with efforts to establish a development model that suits China’s national conditions and features. 　　This conference was jointly hosted by the China Energy Research Society and the American Gas Technology Institute.