Forbes: China Energy Flop - Beijing Slashes Shale Target For 2nd Time
Early this month, Wu Xinxiong, head of China’s National Energy Administration, cut the country’s 2020 production target for shale gas to 30 billion cubic meters. The goal, immediately before the reduction, had been 60-80 bcm.
Despite the big drop, China will have a hard time reaching the goal. At the moment, there is only one major area in operation, Sinopec’s Fuling field, in the Sichuan basin. The state-run company projects production of 5 bcm by next year and 10 bcm by 2017 from Fuling, considered the most promising site in China. Because all sites last year produced just 0.2 bcm from shale, it’s hard to see how producers will meet the 2020 target—or even the 2015 target of 6.5 bcm.
What is so significant about Beijing cutting its 2020 production goal and in all likelihood missing it? Because the shale gas failure shows the limits of what China can do within its top-down economic system.