In 2018, Chinese state-run oil and gas producer Petrochina produced 4.27 bcm of shale gas in the Sichuan province, which is 40% more than in 2017. Its rival Sinopec Corporation, which is developing the Fuling gas field in southwest China’s Sichuan basin (Chongqing region), produced 6 bcm of shale gas in 2018 and remains the largest shale gas producer in China.
Unlike the United States, the Chinese shale gas industry is rather dominated by the two state-run companies (Sinopec and Petrochina) than dozens of private-held or independent companies. Its development is driven by the growing domestic gas demand and the latest governmental policies, which tend to replace coal with gas.
Chinese shale gas production is increasing and the National Development and Reform Commission (NDRC) removed restricted items for foreign investment in the domestic oil and gas sector in July 2017. In order to reduce its dependence on LNG imports, the government is also considering extending subsidies for unconventional gas projects for the 14th five-year plan period (2021-2025). The current 2020 shale gas production targets are set at 30 bcm/year, which is an ambitious objective compared with the current output of 10 bcm/year.