China Calls for Second Round Bids for Shale Exploitation

China’s second round bids for shale gas exploration rights will likely start in September.

In this round wells in 20 districts in 8 provinces will be permitted for exploitation, and joint ventures and private companies with registration capital of more than 300 million yuan are also permitted to bid for exploitation rights, Morning Whistle has reported.

Morning Whistle citing local media reports 77 percent of current recoverable shale gas reserves are geographically overlaid with oil and gas exploitation rights, which are in the hands of PetroChina and Sinopec.

But Zhang Dawei, director of Mineral Resources Reserves Evaluation Center of Ministry of Land and Resources, said that the 20 new approved districts are not overlapped with mining rights of two state-owned companies, the report said.

According to Zhang, related provinces are planning to build pipelines connecting to main pipelines of PetroChina and Sinopec, and the price of natural gas pumped into main pipelines is 1.27 yuan per cubic meter.

Till now the 8 provinces are not publicly announced, but considering policy inclination, they may gather in underdevelopment districts, reported local media.

In a previous survey conducted by Ministry of Land and Resources, more than 70 companies were willing to participate in the shale gas exploitation in the 20 districts, and 1/3 of them are private companies.