Bloomberg: Sinopec, PetroChina Plan 40% Growth in Shale Output to Meet Goal

China’s largest oil and gas producers plan to increase shale-gas output by 40 percent a year to meet the nation’s production target.

China Petroleum & Chemical Corp. (386) plans to invest 21.5 billion yuan ($3.5 billion) in shale-gas drilling and expects to produce as much as 3.5 billion cubic meters by 2015, while PetroChina Co. targets output of more than 2.5 billion cubic meters in 2015 after investing 11.2 billion yuan, according to a press conference transcript posted today on the Ministry of Land and Resources website.

China wants to replicate the shale boom that has cut gas-production costs in the U.S. With almost twice as many deposits as in the U.S., China’s 2015 target depends on the nation’s second-largest producer, known as Sinopec, to produce shale gas at the Fuling project in the country’s southwest. Due to geological challenges and lack of economic incentives, the company has halved its target of producing 60 billion cubic meters by the end of the decade, Zhao Xianliang, a researcher with the ministry, said in July.
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