China is believed to have some of the world's largest shale gas deposits and recently awarded the first round of shale-gas licenses.
Environmentalists are warning however that developing the deposits could have serious consequences for Chinese groundwater reserves, the Shanghai Daily reported.
While the natural gas produced from shale rock formations is environmentally cleaner burning than oil or coal, the process sued to release it -- hydraulic fracturing known as "fracking" -- involves injecting under high pressure a mixture of water and various chemicals into the subterranean rock formations to break up the shale and release the natural gas trapped within.
The risk involved with the procedure is that the various compounds used can contaminate nearby groundwater.
The procedure is strongly promoted in the United States by energy companies as a way to tap into the vast natural gas deposits of the Marcellus Formation, a mapped bedrock unit in eastern North America extending throughout much of the Appalachian Basin.
The shale there contains largely untapped natural gas reserves and its proximity to the high-demand markets along the East Coast of the United States makes it an attractive target for energy development. However, a number of municipalities and counties in several states have filed lawsuits over concerns about the environmental pollution resulting from the hydraulic fracturing used to develop the Marcellus Formation reserves.
Elisabeth Harstad, managing director of DNV Research and Innovation in Shanghai told Shanghai Daily, "Unconventional gas will be a considerable part of the energy mix, and the challenges related to water treatment will have to be solved."
Given the relative newness of hydraulic fracturing in China, China's Ministry of Environmental Protection has yet to study the potential environmental impact of shale gas.
Ministry of Environmental Protection Pollution Control Department Inspector Li Xinmin said: "Shale is usually in rocks deep underground, but we're currently only looking at the environmental impact at shallow depths. There are lots of things to do."
While U.S. shale natural gas deposits are usually found at depths of 1 to 2 miles, in China, some of the key areas in the Sichuan and Tarim basins, which have the greatest potential for shale gas are found at depths of 2 to 4 miles, adding to well costs.
Another environmental concern is that hydraulic fracturing utilizes a great deal of water and the Tarim basin is an arid desert region in northwest China's Xinjiang Uighur Autonomous Region, so shale gas development could compete for a regional resource already in short supply.