How China Could Become a Net Exporter of Oil & Gas: Lessons Learned from International Tight Oil Development

Abstract

Even with very aggressive growth assumptions for renewables, the role for oil and gas will grow, both in absolute terms and as a share of China’s total energy mix. And yet China’s domestic production of oil and gas continues to fall short and China’s need for expensive, foreign imports will only get worse. Meanwhile, the United States – once the world’s largest importer of oil – has become the world’s largest oil producer, with only one-half as many drilling rigs as China. The implications for China are profound. China has an enormous resource base – if China could apply the lessons learned from international development of tight oil and gas, and replicate the US success, it would reap tremendous benefits in terms of energy security, international trade, energy costs, and domestic industrial and economic development.