Schlumberger, Anton set up venture to develop unconventional energy
With an initial investment of US$12m, venture will target unconventional oil and gas resources
Schlumberger, the world's largest provider of oilfield services, has agreed to set up a joint venture with Anton Oilfield Services to tap a boom in unconventional energy on the mainland.
Houston-based Schlumberger, which bought a 20.1 per cent stake in its Beijing-based partner in July, would have a 60 per cent stake in the venture and Anton the rest, Anton said in a statement.
The planned total initial investment was US$12 million, Anton vice-president Peter Pi Zhifeng said in an interview. Anton is one of the largest oilfield services providers not owned by the state.
The venture would combine Schlumberger's global experience and advanced technology with Anton's local knowledge and access to domestic talent and low-cost materials, Anton chairman Luo Lin said.
"A major focus of the joint venture will be on servicing the development of unconventional oil and gas resources," he said. "Given the technical challenges we face in this nascent business, it is very difficult to meet the market's needs through standalone solutions, so we need to provide integrated services by joining forces with our partner."
A major focus of global unconventional energy development is shale gas - natural gas trapped in sedimentary rock. Only in recent years have technological advances in the United States made it possible to economically extract the gas in large quantities.
China is estimated by the US Energy Information Administration to have the world's largest shale gas resource. But owing to a lack of investment and technology, only a few dozen wells have been drilled, compared with thousands in the US.
Beijing has set a target for the mainland's shale gas output of 60 billion to 100 billion cubic metres a year by 2020, compared with a negligible amount now. Reaching this target will require an estimated investment of US$100 billion, the Ministry of Land and Resources says.
Schlumberger and Anton signed a strategic co-operation agreement in 2010 on the sourcing of drilling fluids and cementing services.
An oil well needs to be cemented before production can start to avoid collapsing underground after being drilled.
The mainland accounted for a "low single-digit" percentage of Schlumberger's global sales, executive vice-president Jean-Francois Poupeau said.