China's Fracking Outlook Clouded

choi

Duncan Mavin, China's Bid for Shale-Gas Riches in Doubt. Wall Street Journal, Jan 24, 2013 (in the half page Heard on the Street).
http://online.wsj.com/article/SB ... 59243934254484.html

Quote:

"For starters, most of China's shale resources are deeper than those in the US and the sites are in difficult locations, including in mountainous regions and densely populated areas. That makes drilling and building supporting infrastructure more complex and more costly.

"Also, regulated domestic gas prices, with distribution dominated by state-owned players, deter competition

"The problem this time [compared with a previous round of bidding that drew little interest], though, is that few winning bids came from companies with specific expertise in shale-gas production, according to Bernstein Research analyst Neil Beveridge. More than 80% of the winning bids came from local energy companies, coal companies and power companies, suggesting the process was 'more of a land grab than an effective policy to open up acreage,' he says.