Shale Development and China

China is currently the only Asian country producing shale gas commercially. Shale development in China faces both opportunities and challenges. Natural gas accounts for a small percentage of China’s energy consumption, but the vast shale gas reserve in China provides great potential for development. The lower emissions of natural gas compared to other fossil fuels present China with much needed environmental benefits. However, technological difficulties due to geological formations, water shortage, and monopolistic nature of China’s oil and gas industry tempered the incentive to invest. Market reforms and technological advancements could speed up the development of shale in China.