07-07-2013, 02:35 AM
The Chinese can squawk all they want, but near term they are forced to pay up. Their shale assets distinguish them from Japan and SK, but Chinese shale basins are generally smaller, deeper and more complex. They are also spread out across more than 150 separate basins and generally are distant from demand centers. And with limited existing infrastructure in many areas, as well as water supply issues, costs are expected to be substantially higher. Importantly, state regulation of
gas prices may defer risk-taking by non-NOCs, and more broadly, China generally lacks the community of incentivized risk-taking independents that essentially pioneered the technological changes in horizontal drilling and hydraulic fracturing. This may effectively slow down the pace of China’s shale evolution. IOC has the goods that these countries need to secure now.
gas prices may defer risk-taking by non-NOCs, and more broadly, China generally lacks the community of incentivized risk-taking independents that essentially pioneered the technological changes in horizontal drilling and hydraulic fracturing. This may effectively slow down the pace of China’s shale evolution. IOC has the goods that these countries need to secure now.