Breitling Oil and Gas Morning Podcast #72 May 21th, 2012

The U.S. is prioritizing China’s development of shale gas in discussions relating to energy at an upcoming bilateral summit, as it views the unconventional fuel as vital for securing China’s energy security, reducing carbon emissions and freeing up gas for global markets, the head of the U.S. Energy Resources Bureau said Tuesday.

U.S. Ambassador Carlos Pascual, the country’s special envoy and coordinator for international energy affairs, said the main focus of energy discussions at the U.S.-China Strategic Economic Dialogue will be on how the U.S. can help develop China’s shale-gas resources.

In recent years, a boom in hydraulic fracturing, or fracking, to free up gas locked in shale deposits has flooded the U.S. with cheap natural gas–and China is hoping to replicate that experience.

China plans to boost the contribution of natural gas to the country’s energy mix to 10% by 2020 from less than 5% in 2010 to cut its dependency on coal, which accounts for around 70% of the mix.

China, the world’s largest energy consumer, may hold 25.08 trillion cubic meters of “potentially recoverable shale gas resources,” its Ministry of Land and Resources has said. In comparison, the U.S. has about 13.65 trillion cubic meters of “unproved technically recoverable resources,” according to the U.S. Energy Information Administration.

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