China reveals five-year plan for shale gas industry

Wants to duplicate US success in shale gas extraction.

China’s 2011-2015 plan for the shale gas industry confirmed it will increase fiscal support and reduce taxes for explorers and producers. The plan also seeks financially strong participants and urges increased cooperation with foreign partners for technological knowhow.

It offers general policies regulating the industry but does not give too much update on details. China, however, said the sector shouldn't be developed at the cost of the environment, banning shale development in nature reserves, scenic spots and areas with a rich drinking water source.

China has the world's largest deposits of shale gas, much of it in inaccessible locations, and there has been little commercial production to date.

Despite China’s shale gas plan, analysts question whether China can meet its shale gas production target of 6.5 billion cubic meters by 2015 and 60 to 100 billion cubic meters by 2020.