In this paper, we use the US shale gas experience to shed light on how China might overcome the innovation problem inherent in exploring and developing shale gas plays with complex geology. We separate shale gas development into two stages, an innovation stage and a scaling-up stage, with the first presenting a much bigger challenge than the latter. Our analysis suggests that China’s national oil companies offer the best hope for overcoming the innovation problem. China’s policy of opening shale gas development to new entrants is a market-oriented reform that can be justified on various grounds, but the new entrants will not play a major role in overcoming the innovation problem even though they may help scale up production later on.
Stimulating Shale Gas Development in China: What Lessons to Learn from the US Experience?
China’s pressing need to reduce coal consumption has created a strong demand for the natural gas trapped in its large shale reserves. The Chinese g...
Could Blockchain Technology Improve Water, Wastewater, and Solid Waste Management in the Oil and Gas Industry?
Reducing Risk in Merchant Wind and Solar Projects through Financial Hedges
We explore the risks and costs of financial hedges in renewable energy.