China approves shale gas PSC for Shell

The Chinese government approved a production-sharing contract for Royal Dutch Shell PLC and China National Petroleum Corp. (CNPC) to develop China’s shale gas reserves, Shell Chief Executive Peter Voser said in Beijing Mar. 26.

The approval finalizes an agreement that Shell China Exploration & Production Co. Ltd. and CNPC announced last year to jointly explore, develop, and produce shale gas from Fushun-Yongchuan block in the Sichuan basin (OGJ Online, Mar. 26, 2012).

The CNPC-Shell shale gas PSC covers 3,500 sq km.

Voser said Shell plans “a significant drilling season in 2013 and in 2014.” Separately, Chinese officials have said the country’s goal is to produce 6.5 billion cu m/year of shale gas by 2015.