China May Drill 20,000 Shale Wells by 2020

The second round of auction will catapult the status of the Chinese shale gas industry in the world from being hypoactive to being commercially productive by the end of 2013, Kuick Research has aid in a report. The country will see 20,000 shale gas wells being drilled until 2020.

The second shale gas auction in China saw the awarding of the exploration rights of 20 more blocks.

“The increased enthusiasm of shale gas and its ability to provide China the independence from imported gas can be seen through the 152 bids received this year, a very large number as compared to the last auction,” the report said.

China offered 20 shale gas blocks in a second tender, with a total area of 20,002 square kilometres in 8 provinces. Five blocks are in Guizhou and Hunan each, three in Chongqing, two in Hubei and Henan and one each in Jiangxi, Anhui and Zhejiang.

The report further added that with such huge reserves available, China will have to start production quickly but systematically so as to not lose the opportunity of becoming a gas exporter after being an importer for so long. “The success of the second round will invite even more players in the subsequent rounds and ensure adequate support required for shale gas in the country.”

Estimates have said Chinese shale gas reserves surpass even that of North America and will be sufficient for the next 60 years at the current Reserve to Production (R/P) ratio.