Foreign investment worth $26bn pushing US shale industry forward

MINING.com Editor | April 8, 2013 | 9:32 pm Energy Asia China 

Since 2008, 21 international joint ventures totaling $26 billion are playing a significant role in the US shale oil and gas boom, according to recent analysis from the US Energy Information Association (EIA).

A recent $1.7 billion joint venture involving Chinese firm Sinochem in the West Texas Wolfcamp Shale play highlights a the trend of increasing foreign interest in US shale.

Here are some key stats and facts from an EIA report today:

  • Total US shale investment reached $133.7 billion between 2008 and 2012, part of 73 deals.
  • Joint ventures by foreign companies accounted for 20% of these investments.
  • Foreign investors in joint ventures pay cash upfront and commit to cover the cost of drilling extra wells within an agreed-upon time frame, usually between 2 to 10 years.
  • Most of the recent joint venture deals with foreign companies shifted from the dry natural gas plays to more liquids-rich areas.
  • All shale plays contain some liquids, but those with a higher liquid-to-gas ratio are more attractive because of the higher value of hydrocarbons that have crude oil and petroleum liquids in addition to natural gas.

Graph of annual light bulb sales, as explained in the article text

 

Photo credit and source: the US Energy Information Association

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