BEIJING: Chinese state energy giant PetroChina plans to spend more than 10 billion yuan ($1.6 billion) on shale gas this year, sources with knowledge of the matter said, as domestic competition heats up after rival Sinopec announced a commercial find.
Faced with high drilling costs and the complexity of tapping shale gas, China has struggled to revolutionize its energy supplies. The top energy consumer wants to unlock what could be the world’s largest shale gas reserves by emulating the hectic success of the US shale boom.
PetroChina’s decision to triple its shale gas spending from expenditures on the unconventional fuel over the past few years comes just months after Sinopec Corp. lifted hopes that China is near a breakthrough by announcing a commercial find.
PetroChina, Asia’s largest oil and gas producer, has also lifted its 2015 shale gas output target to 2.6 billion cubic meters (bcm), up from the previous 1.5 bcm, according to a company official and a government source.
That would represent only about 2.3 percent of China’s total natural gas output of around 113 bcm last year.
“PetroChina wants to play catch up after Sinopec’s success,” said a government source who has been briefed on PetroChina’s plans.
Since around 2010, PetroChina has spent about 3 billion yuan ($482.39 million) total on pilot shale drilling, according to both sources. The state giant, which makes up around 70 percent of China’s total natural gas output, has so far largely focused on growing its conventional oil and gas portfolio.
PetroChina will focus on two pilot zones — Weiyuan-Changning in southwest Sichuan basin and Zhaotong in Yunnan province.
“PetroChina has over the past four years improved understanding of the shale resources and achieved some technological breakthroughs,” said Mao Zefeng, joint company secretary of PetroChina.
“We’re stepping up shale gas development this year,” he said.
Sinopec’s shale work has been concentrated in the Fuling area of Chongqing municipality in southwest China, also part of the Sichuan basin, one of the most promising geological zones for the unconventional fuel. Sinopec has drilled nearly 30 pilot shale gas wells in the Fuling area. The main challenge for both Sinopec and PetroChina is to cut the drilling cost per well to under 50 million yuan ($8 million), half the current hefty rates averaging around 80-100 million yuan, experts say.
That requires a factory-style operation and technological improvements to shorten the drilling period for each well.
At Fuling, Sinopec is now able to drill up to six wells simultaneously from one platform, cutting down the drilling time for a single well to 89 days from 100 days.
Even so, Sinopec has only managed to reduce its per-well costs to about 80 million yuan, an amount that is economic only with a government subsidy of 0.40 yuan per cubic meters of production, industry officials said.
China pumped about 113 bcm of natural gas last year, of which shale gas was a meagre 200 million cubic meters, according to official data.
The government has set shale gas production targets at 6.5 bcm for 2015 and at 60-100 bcm for 2020.
PetroChina hikes shale gas spending to more than $1.6bn
PetroChina hikes shale gas spending to more than $1.6bn
Kuwait to boost Islamic finance with sukuk regulation
- The move supports sustainable financing and is part of Kuwait’s efforts to diversify its oil-dependent economy
RIYADH: Kuwait is planning to introduce legislation to regulate the issuance of sukuk, or Islamic bonds, both domestically and internationally, as part of efforts to support more sustainable financing for the oil-rich Gulf nation, Prime Minister Sheikh Ahmad Abdullah Al-Ahmad Al-Sabah said on Wednesday.
Speaking at the World Governments Summit in Dubai, Al-Sabah highlighted that Kuwait is exploring a variety of debt instruments to diversify its economy. The country has been implementing fiscal reforms aimed at stimulating growth and controlling its budget deficit amid persistently low oil prices. Hydrocarbons continue to dominate Kuwait’s revenue stream, accounting for nearly 90 percent of government income in 2024.
The Gulf Cooperation Council’s debt capital market is projected to exceed $1.25 trillion by 2026, driven by project funding and government initiatives, representing a 13.6 percent expansion, according to Fitch Ratings.
The region is expected to remain one of the largest sources of US dollar-denominated debt and sukuk issuance among emerging markets. Fitch also noted that cross-sector economic diversification, refinancing needs, and deficit funding are key factors behind this growth.
“We are about to approve the first legislation regulating issuance of government sukuk locally and internationally, in accordance with Islamic laws,” Al-Sabah said.
“This enables us to deal with financial challenges flexibly and responsibly, and to plan for medium and long-term finances.”
Kuwait returned to global debt markets last year with strong results, raising $11.25 billion through a three-part bond sale — the country’s first US dollar issuance since 2017 — drawing substantial investor demand. In March, a new public debt law raised the borrowing ceiling to 30 billion dinars ($98 billion) from 10 billion dinars, enabling longer-term borrowing.
The Gulf’s debt capital markets, which totaled $1.1 trillion at the end of the third quarter of 2025, have evolved from primarily sovereign funding tools into increasingly sophisticated instruments serving governments, banks, and corporates alike. As diversification efforts accelerate and refinancing cycles intensify, regional issuers have become regular participants in global debt markets, reinforcing the GCC’s role in emerging-market capital flows.
In 2025, GCC countries accounted for 35 percent of all emerging-market US dollar debt issuance, excluding China, with growth in US dollar sukuk issuance notably outpacing conventional bonds. The region’s total outstanding debt capital markets grew more than 14 percent year on year, reaching $1.1 trillion.
