On paper, China seems to be poised to drastically increase its natural gas production in the upcoming decade. With 50% more shale gas reserves than the United States, the world’s largest natural gas producer, China can potentially satisfy its voracious domestic energy demand. However, while the introduction of horizontal drilling and hydraulic fracturing in the US may have made the whole process of revolutionizing a nation’s energy industry smooth and easy, such is not the case for China.
Unlike the US, the Asian superpower’s economic and natural environments are not ideal for shale gas extraction. As the name hydraulic fracturing implies, very large amounts of water are necessary to tap shale resources. Most of China’s natural gas shale resources are in arid dessert where water is hard to find.
Additionally, China’s politics make it hard to introduce all the technology and infrastructure that made fracking such a success in the US. While innovation and ingenuity transformed the US into an energy superpower, China’s energy market is dominated by big, stagnant state-owned companies. The American companies that spent billions of dollars developing and perfecting horizontal drilling and hydraulic fracturing technologies do not feel their intellectual property will be safe if they cooperate with Chinese exploration companies.