China opens up shale rights bidding

Foreign firms are eyeing reduced regulation and potentially bigger returns on oil operations in China, Caixin reported. The Chinese government this month said that it would allow private companies and joint-venture firms to bid for shale gas exploration rights in China. During the next round of public bidding, prospective shale explorers will have a chance to bid on 20 shale gas blocks covering a total of 20,000 square km in provinces such as Guizhou, Hunan and Hubei. The announcement means that foreign firms with joint ventures in China will see greater returns on their investment. Previous regulation put the burden of exploration, development and production costs on foreign firms. The costs will now be split between joint ventures. Royal Dutch Shell (RDS.A. NYSE, RDS.B, NYSE, RDSA.LON, RDSB.LON, RDSA.AMS) is seeking a joint venture with a Chinese oil company, according to an anonymous source from the company.