Blog post from Platt's regarding the Enviro Energy/CNPC PSC that went south (probably better to be partnered with CUCBM here). Sheds some light on why demand may be high for an existing block as far along as Shouyang.
In all fairness, some measures have worked, such as government efforts to simplify the approvals process. Since May last year, smaller oil and gas projects no longer need to be sanctioned by the central government before commercial development can start.
“The central government has decentralized control and allowed provincial divisions to be engaged in regulating CBM development, compared with say, five years ago. …This makes [project] execution more convenient,” said another foreign CBM operator.
This is all the more advantageous because the nature of CBM dictates that more collaboration with local governments is beneficial to ongoing projects, said the operator.
“Because it is unconventional [gas] trapped within coal seams, there is a lot more engagement at the provincial level than there is with the central government,” he added.
However, the downside of decentralization of these processes means any company keen to get involved in a new project will find the bureaucracy difficult to navigate, the operator said.
“The hurdles have gotten worse, because now you’ve got to start at the provincial level and make your way to the central level to ever get anything approved. So from an execution standpoint, if you have a deal, it’s getting better. If you don’t and you want to do a new deal, in my view it’s impossible,” the operator said.
