China finds itself sitting on a bonanza of shale gas. Its reserves are the world’s largest – about 1,115 trillion cubic feet, according to EIA – beating even those of the United States.
Earlier this year, Shell agreed to spend $1 billion a year to unlock shale gas in China cooperating with China National Petroleum. Shale gas could reduce China’s energy costs, reduce imports, lead the country towards energy independence, create jobs, and develop the GDP.
The two companies have planned to start operations in the Fushun-Yongchuan block in the Sichuan basin which accounts for 40% of China’s shale gas reserves. However, some experts said to Bloomberg this is a seismically active province:
“For the Sichuan basin, earthquakes are a problem for shale gas and shale oil production because of the tectonic conditions,” said Shu Jiang, a professor at the University of Utah’s Energy & Geoscience Institute in Salt Lake City. “The siting of the wells could cause some artificial earthquakes.”
“The Sichuan basin is at the edge of the biggest continental collision in the world, India smashing into Asia,” said Julio Friedmann, chief energy technologist at the Lawrence Livermore National Laboratory and former research scientist at Exxon Mobil Corp. “That’s stressing the continental crust.”
However, Shells says seismic studies before drilling have been conducted. “We do detailed structural analysis as routine part of our pre-drill evaluation,” Shi Jiangtao, a Shell spokesman in Beijing, said in an e-mail. “This means that we evaluate the geology by using seismic, surface geology, nearby well data, etc.” (Bloomberg)
How will the two companies deal with seismic concerns in the region? Is there any latest technology available to support this process? China aims at extracting up to 100 billion cubic metres by 2020. Will this become a reality? Let us know your say.
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