Australia tips China as shale gas hope

China may boast the world’s largest potential reserves of shale gas but is likely to lose to Australia in the race to be second behind the US in bringing significant production on line.

While it’s clear that the US has gained, and will continue to enjoy, first- mover advantage, it’s also likely that the next shale gas producer stands to reap substantial benefits.

For China, boosting domestic natural gas output would reduce dependency on expensive imports in the form of liquefied natural gas or pipelines from Russia and central Asia. For Australia, developing significant shale output could underpin a new round of Liquefied Natural Gas (LNG) projects, either at existing plants or greenfield sites, that would give the nation an unassailable global lead in the market for the super-chilled fuel.