Domestic tech overcoming unique geographical hurdles

China's shale gas exploration sector, which grew to nearly 600 wells and 9 billion cubic meters of production last year, is due to advance further thanks to new domestic drilling technology and cost cutting strategies, according to analysts.

According to Li Li, research director at energy consulting company ICIS China, the country is currently experiencing relatively high shale gas exploration costs due to its different geographical characteristics as compared to the United States.

Shale formations in China tend to be deeper and more tectonically fractured, which requires deeper wells that lead to higher costs and difficulties in maintaining the well while drilling. High population density also makes drilling and hydraulic fracturing harder, Li said.