Bloomberg: China Shale Boom Seen by Honghua as Pollution Cuts Coal Use

Honghua Group, a Chinese drilling-equipment maker that gets most of its business from overseas, is seeking to expand at home as the nation works to spark its own shale gas revolution.

The Chengdu, Sichuan-based company, which has sold rigs for use in U.S. gas fields since 2005, sees an opportunity in China as the country looks to boost production from shale formations to meet growing energy demand and move away from dirtier sources of fuel like coal, Chairman Zhang Mi said in an interview.

“It’s highly likely for China to develop shale on a large scale like the U.S.,” Zhang said in Beijing on April 23. “China needs natural gas very badly.”

China, the world’s biggest holder of natural gas reserves trapped in shale rocks, has set a national output goal of 6.5 billion cubic meters by 2015 and as much as 100 billion cubic meters by 2020. While China’s reserves are almost double that of the U.S., its target is smaller than U.S. production, which reached about 290 billion cubic meters in 2012. MORE