Two private firms win 2nd round shale gas bidding

BEIJING -- Two Chinese private firms along with 14 State-owned enterprises won the country's second round auction of exploration rights for shale gas blocks, natural resources watchdog said Thursday.

The Ministry of Land and Resources, or MLR, released the results, showing that State-owned enterprises outnumbered private ones in the bidding for the new energy.

Huaying Shanxi Energy Investment Co Ltd, a subsidiary of Wintime Energy Co Ltd and Beijing Taitantongyuan Natural Gas Technology Co Ltd, two private enterprises, won the biddings of two blocks in Fenggang, Guizhou.

A total of 14 State-owned enterprises got the remaining 17 blocks. Most of them engage in electricity or coal mining.

Huadian Corp, China's electricity giant, turned out to be the largest winner with three of its subsidiaries seizing exploration rights of four blocks.

None of the traditional oil companies won the bidding, and China National Petroleum Corp, parent of PetroChina, China's largest oil and gas producer, was only awarded 3rd candidate for a shale gas block in Hunan.

China held the first round auction of exploration rights for four shale gas blocks in June of 2011 by inviting six State-owned enterprises to participate. CNPC and Henan Provincial Coal Seam Gas Development and Utilization Co Ltd each won a block.

The second round auction was held on Oct 25 this year. The blocks bidded this time cover 20,002 square kilometers in Chongqing, Guizhou, Hubei, Hunan, Jiangxi, Zhejiang, Anhui, and Henan.

A total of 83 enterprises participated in the auction, and a third of them are private.

According to statistics released by the MLR, China has launched 26 exploitable shale gas blocks, and the exploitable shale gas reserve is estimated at 25.08 trillion cubic meters.