Shale Compendium: Russia, China, and India

Russia

• Shale Boom Could Happen in Russia, China but not Europe (Wall Street Journal)

• Bazhenov Shale 80 times bigger than the Bakken shale (Forbes)

• Current Russian legislation taxes crude exports at 90% revenue per barrel. (Reuters)

• Putin has posturing publicly that export taxes will be reduced. Proposed extraction tax for unconventional oil was introduced but has not yet passed. (Bloomberg Jun. 2012; Reuters Apr. 2013)

• Rosneft partners with ExxonMobil for exploration of Bazhenov shale, shale development aimed to offset declines in other fields and maintain its own output. (Reuters)

• Gazprom began drilling an appraisal well in a second tight oil project (Gazprom News)

China

• Royal Dutch Shell received government approval for a production sharing contract with China National Petroleum (US$1B investment). “Shell and CNPC, the state-controlled parent of PetroChina Co., agreed to explore, develop and produce shale gas in the Fushun-Yongchuan block in the Sichuan basin, an area covering about 3,500 square kilometers” (Bloomberg Mar. 2013)

• TerraWest Energy and Petromin Resources have production sharing agreements with China National Petroleum (Oil & Gas Journal)

• Gazprom partnered with China National Petroleum for development of Chinese shale fields (Oil & Gas Journal)

• Total and Sinopec signed a joint agreement to explore shale gas reserves in China (Upstream)

• Government expected to unveil new policies for shale development (Platts Mar. 2013)

• Yet-to-be determined policies and regulations (Center for Strategic and International Studies, Prospects for Shale Gas Development in Asia 2012 report p. 6-8)

India

• Indian Oil Minister M Veerappa Moily told reporters “We have received comments on the draft shale gas exploration policy we had floated.  We are now in the process of putting out a note for the consideration of the Cabinet and hopefully in a months time we will be able to announce the shale gas policy.” (Business Standard Feb. 2013)

• Indian Oil Secretary, Vivek Rae said “We can not offer existing blocks for shale gas exploration to other companies. However, in future we may have a single round and companies will be allowed to commercially exploit whatever they think is more profitable" (Reuters Mar. 2013)

• Indian government has not yet adopted regulations for shale development, draft regulations expected in 2013 (Prospects for Shale Gas Development in Asia p. 13)

• India to unveil shale policy within two weeks (Reuters Mar. 2013)

Written by Anna Leonenko, Research Fellow

Penn State Law, Agricultural Law Center

May 2013