China's energy regulator, the National Energy Administration (NEA), unveiled the country's first policy for the shale gas industry on its website on Wednesday, promising to increase financial support for shale gas exploration and extraction.
The shale gas industry policy aims to explore shale gas resources in a reasonable and orderly manner, secure healthy development of the industry, increase natural gas supply, assist energy conservation and emission reduction, and safeguard national energy security, according to a bulletin posted on the administration's website.
According to the NEA, the policy includes five items, which include designating shale gas as one of the nation's strategic emerging industries, providing subsidies for shale gas producers, encouraging provincial governments to subsidize local producers, tax reductions or exemptions for producers, and customs tariff exemptions for imported equipment.
The policy also encourages development, innovation and Chinese-owned brands in shale gas exploration and extraction technologies.
The NEA said the policy is in effect immediately.
Energy-thirsty China, the world's second-largest economy and one of the largest energy consumers, has seen its natural gas consumption continue to rise over the past years. As a result, unconventional energy, including shale gas, has become an alternative in recent years.
In 2012, the Ministry of Land and Resources said China has estimated shale gas reserves of 134 trillion cubic meters, of which 25 trillion is extractable.
The U.S. Energy Information Administration has claimed that China has the world's largest shale gas reserves, estimated at 36 trillion cubic meters.
China has set an ambitious target to boost its annual shale gas output to 6.5 billion cubic meters by 2015, a huge leap from the estimated 2013 output of 200 million cubic meters.
The Ministry of Land and Resources has launched two shale gas tenders -- one in 2011 and the other in 2012 -- in a bid to attract more developers into the shale gas industry.