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Shale gas development progress is much lower than expected
Shale gas exploration and development in China has faced significant challenges, prompting the National Energy Administration and other relevant departments to take more proactive measures. On January 7th, it was reported that the administration held a meeting with the Ministry of Finance, Ministry of Land and Resources, and the Ministry of Environmental Protection to review the progress of the "Shale Gas Development Plan (2011-2015)" and address ongoing issues. The goal is to accelerate shale gas production and ensure the successful implementation of the 12th Five-Year Plan.
During the meeting, Deputy Director Zhang Yuqing emphasized that the National Energy Administration will continue working closely with various departments to improve policies, support technological research, and establish industry standards. This effort aims to create a better environment for the long-term development of the shale gas sector.
Since 2011, the Ministry of Land and Resources has launched two rounds of bidding for shale gas exploration. Attracting both state-owned and private enterprises, the second round saw nearly 300 companies competing for exploration rights. Despite this enthusiasm, the actual progress has been slower than expected.
According to recent data, China’s daily shale gas output has exceeded 2 million cubic meters, with Sinopec and PetroChina achieving commercial success in their demonstration zones. In 2015, Sinopec's Chongqing Fuling Block aimed to produce 3.2 billion cubic meters, nearly doubling its previous target. However, many industry insiders remain skeptical about whether the overall 2015 target of 6.5 billion cubic meters can be met.
Experts like Lin Boqiang from Xiamen University point out that 2013's output was still far below the 2015 target, and while some breakthroughs may occur in the next two years, optimism remains limited. Key obstacles include reliance on foreign technology, high costs, small-scale production, and underdeveloped pipeline infrastructure.
Despite these challenges, major players such as PetroChina, Sinopec, and CNOOC have expressed confidence in the government’s supportive policies. They hope for clearer subsidies during the 13th Five-Year Plan period and stronger investment in R&D and technical standards.
Zhang Yuqing urged companies responsible for the 12th Five-Year Plan to adhere to their targets and work diligently to meet them. Looking ahead, continued focus on technological innovation, integration, and environmental protection will be essential for the sustainable growth of China’s shale gas industry.