Chinese shale gas delegation visits Southpointe

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Qing Yang received a birds-eye view of the Pittsburgh region and its many Marcellus Shale wells Friday morning, participating in a fly-over of the region with 10 representatives of the China Shale Gas Delegation.


“The Pittsburgh we saw is a very beautiful city,” said Yang, who is director of the petroleum and natural gas department of China’s National Energy Administration.


Friday’s event, sponsored by the Southpointe Marcellus Chamber of Commerce in cooperation with the U.S. Trade and Development Agency, brought the 10 Chinese delegates to Southpointe to meet with U.S. shale operators to learn about U.S. technologies and the best approaches to shale gas development.


Also attending, in addition to representatives from USTDA, were those from the U.S. Commercial Service and Wilfred Muskens, deputy secretary for international business development for the Pennsylvania Department of Community and Economic Development.


Speaking through an interpreter, Yang explained China already is developing shale gas wells in the Sichuan Basin and Yangtze River areas, but said the chance to study and learn about the U.S. experience with shale gas, especially at what has been described as the shale gas center of the United States, “is a very rare opportunity.”


During a half-hour panel discussion at Bella Sera restaurant in Cecil Township involving representatives of several regional companies working in the Marcellus, delegates learned about natural gas distribution, water treatment and other technologies that have developed as the domestic shale gas industry has evolved.


Yang and his delegation are at the forefront of their government’s determination to make shale gas development a priority.


According to a recent report from the U.S. Energy Information Administration/Advanced Resources International, China has an estimated 1.115 trillion cubic feet of technically recoverable shale gas in three basins. The estimate places the country just behind the United States, which has 1.161 trillion cubic feet.


But unlike North America, the EIA/ARI study notes China’s service sector is just beginning to acquire the necessary capability for large-scale horizontal drilling combined with multi-stage hydraulic stimulation.


To date, China has spent $1.6 billion to develop about 130 shale gas wells.


The EIA/Advanced Resources study notes that while China’s government is making shale gas development a priority on legal, technological and commercial fronts, geologic and industry conditions are considerably less favorable in China than in North America.


China hopes tailoring U.S. drilling methods to its conditions could be the key to opening the country’s shale potential.


The group, which in addition to Yang and others from the NEA included delegates from National Energy Shale Gas Research and Development Center, the International Cooperative Department of the NEA, the Department of Geological Exploration of the Ministry of Land Resources, and the Department of Environmental Impact Assessment, heard from representatives from companies providing solutions for exploration and development companies in the Marcellus.


Bill Pollock, a partner in Neo Gas N.A., described how his company has developed ways to bring natural gas to large industrial systems and vehicles not served by natural gas pipelines.


Ron Pettengill, an executive vice president for start-up Epiphany, described how the company uses solar and natural gas to treat fracking production water, which flows back with salts and chemicals that can’t be put directly back into the watershed.


It was also noted by Brian Hyita, an industry consultant, that there could be business opportunities in technology exchanges with Chinese companies.


“The (U.S.) drilling industry uses drills that incorporate Chinese-built components,” said Hyita, who noted that technology exchange already exists between Chinese and U.S. companies.


During a video presentation using Google Maps, Ernest Benchek of Boord Benchek Associates Inc. showed how his company helps drillers prepare large rural gas lease areas for everything from roads to pad sites.


“If you don’t do this right the first time,” Benchek said, the cost of trying to do it again could be prohibitive.


The Chinese delegation, which began the week touring the EPA and other agencies in Washington, D.C., will spend next week visiting oil and gas production companies in Houston and Dallas, Texas, before returning home.


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