Gu Suhua writes from Beijing: China is cripplingly short of energy. I hope that sort of opening line gets your attention. Especially if you live in China or are about to move here, bedazzled by all the prosperity that is confined, so that you know, to about eight cities.
Communism and prosperity for all don’t mix, you see. Anyway, everyone’s talking about shale gas here these days. Inspired by the myth peddled in America, China plans to ratchet up its own production, supposedly having the largest shale gas reserves in the world.
Foreign companies need assurances that they will not be nationalised in the future when they become profitable. Since energy is a state monopoly, the legal framework for the development of shale gas by private Chinese and foreign companies has to be put in place first. And that would take some time.
Shale gas exploitation in America is being driven by small and medium sized enterprises. In China it is the big oil companies – all state owned – that are involved. Beijing needs to pass legislation making it possible for small and medium sized private companies to get involved in this fast growing market. In other words, the state energy monopoly has to be relaxed. A post made earlier today over on Stirring Trouble Internationally - A humorous take on news and current affairs.