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A Comparison between Shale Gas in China and Unconventional Fuel Development in the United States: Health, Water and Environmental Risks

51 Pages Posted: 4 Dec 2013 Last revised: 6 Sep 2016

Paolo Davide Farah

West Virginia University (WV, USA); gLAWcal - Global Law Initiatives for Sustainable Development (United Kingdom); University Institute of European Studies - IUSE (Turin, Italy)

Riccardo Tremolada

Cleary Gottlieb Steen & Hamilton LLP; gLAWcal - Global Law Initiatives for Sustainable Development

Multiple version iconThere are 2 versions of this paper

Date Written: December 3, 2013

Abstract

China is appraised to have the world's largest exploitable reserves of shale gas, although several legal, regulatory, environmental and investment-related issues will likely restrain its scope. China's capacity to successfully face these hurdles and produce commercial shale gas will have a crucial impact on the regional gas market and on China’s energy mix, as Beijing strives to decrease reliance on imported oil and coal, while attempting to meet growing energy demand and maintain a certain level of resource autonomy. The development of the unconventional natural gas extractive industry will also endow China with further negotiating power to obtain more advantageous prices from Russia and future liquefied natural gas (LNG) suppliers. This paper, adopting a comparative perspective, underlines the trends learned from unconventional fuel development in the United States, emphasizing their potential application to the Chinese context in light of recently signed production-sharing contracts between qualified foreign investors and China. The wide range of regulatory and enforcement problems in this matter are accrued by an extremely limited liberalization of gas prices, lack of technological development, and political hurdles curbing the opening of resource extraction to private investors. These issues are exacerbated by concerns related to the risk of water pollution deriving from mismanaged drilling and fracturing, absence of adequate regulation framework and industry standards, entailing consequences on social stability and environmental degradation.

Notes: The most updated version of this paper is published as “A Comparison Between Shale Gas in China and Unconventional Fuel Development in the United States: Water, Environment and Sustainable Development”, 41 Brookly Journal of International Law 2, Spring Issue, 2016, pp. 579-654. Available at: http://ssrn.com/abstract=2802157'> http://ssrn.com/abstract=2802157.

Keywords: Shale Gas, Unconventional Fuel, China, U.S.A., Health, Water, Environmental Risks

JEL Classification: A12, A13, D40, D62, D81, F10, F13, F18, H23, K32, K33, Q4, Q40, Q41, Q42, Q43, Q48, F1, F13, F40

Suggested Citation

Farah, Paolo Davide and Tremolada, Riccardo, A Comparison between Shale Gas in China and Unconventional Fuel Development in the United States: Health, Water and Environmental Risks (December 3, 2013). FEEM Working Paper No. 95.2013. Available at SSRN: https://ssrn.com/abstract=2362774 or http://dx.doi.org/10.2139/ssrn.2362774

Paolo Davide Farah (Contact Author)

West Virginia University (WV, USA) ( email )

325 Willey Street
Morgantown, WV 26506
United States

HOME PAGE: http://paolofarah.wordpress.com

gLAWcal - Global Law Initiatives for Sustainable Development (United Kingdom) ( email )

United Kingdom

HOME PAGE: http://www.glawcal.org.uk/

University Institute of European Studies - IUSE (Turin, Italy) ( email )

Turin
Italy

HOME PAGE: http://paolofarah.wordpress.com

Riccardo Tremolada

Cleary Gottlieb Steen & Hamilton LLP ( email )

One Liberty Plaza
New York, NY 10006
United States

gLAWcal - Global Law Initiatives for Sustainable Development ( email )

52 East Quay, Wapping Quay
Liverpool, L3 4BU
United Kingdom

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