China has begun trials of a controversial drilling technique to exploit the world’s largest reserves of shale gas, as it attempts to cope with the increasing energy demands of a fast-growing economy while reducing its dependence on coal.
In the past two weeks, engineers have completed the country’s first horizontal shale gas well in Sichuan and government officials have begun drafting a national strategy to identify a trillion cubic metres of exploitable resources by 2020.Supporters say China has the potential to emulate the United States, where extraction of shale gas has tripled the lifespan of US gas reserves and offered a lower-carbon alternative to coal.
“Shale gas is a game-changer for the US and should do the same for China,” said Ming Sung, Asia representative of the Boston-based Clean Air Task Force and an advocate of closer energy links between the two nations. “This should be one of the centre-pieces for China’s energy strategy. As with any new technology development, we must balance benefits versus potential environmental impacts. The experiences of the US are valuable here.”
The extraction method itself is costly, controversial and challenging. Hydraulic fracturing or “fracking” involves the injection of chemically treated water at high pressure through seams of rock, forcing the gas inside to seep out to where it can be captured. Environmentalists warn that this wastes and contaminates millions of tons of water.
For fuel-hungry China, this poses a conundrum. The energy potential is enormous. The ministry of land and resources calculates the size of shale gas reserves at 26tn cubic metres — more than 10 times the country’s known holdings of conventional natural gas.
This is a alternative for a country that is eager to improve its energy security in the face of rising oil and coal imports. A global shale gas study released this month by the US Energy Information Administration said China’s technically recoverable shale gas reserves were almost 50% higher than those of the number two nation, the US.
But tapping them will be expensive and difficult for a country that is desperately short of water and — until recently — lacking experience in the key technologies.
“The success of this well is valuable for the future of horizontal shale gas technology,” said an industry source. “We expect to reach our targets for exploration and development ahead of schedule.”
Executives at China National Petroleum Corporation — China’s biggest energy company — have said they aim to produce 500 million cubic metres of shale gas by 2015.
In an effort to wean the economy off coal, China plans to triple the use of natural gas so that it supplies 10% of the country’s energy needs by 2020. Most of this will come from conventional wells and coal-bed methane, but the share from shale is in fact likely to hit 12% by 2020 and continue rising.