BEIJING, September 18. /ITAR-TASS/. China expects to increase shale gas production from the current 200 million cubic meters to 30 billion cubic meters annually by 2020, its Ministry of Land and Resources has said, Meiri Jingji Xinwen business daily reported on Thursday.

But technological inferiority was the main obstacle to reaching this goal, said Wang Xiaokun, analyst at the country’s leading energy analytical agency SCI99, quoted by the newspaper as saying that if the country secured the technology it needed, fuel production was expected to increase rapidly.

Current technology used hydraulic fracturing, requiring huge amounts of water at a time when China faced drinking water shortages, said the report. And no extensive pipeline network existed to deliver the volumes produced, it added, citing Chinese ministry figures of 200 million cubic meters produced in 2013. Production would rise to 6.5 billion cubic meters in 2015, the paper said.

Two operators will dominate shale gas production as the industry goes forward, according to previous TASS reports. PetroChina, a subsidiary of China National Petroleum Corporation, CNPC, will be in contention with rival Sinopec.

Sinopec is developing the Fuling field in southwest China's Sichuan province and is currently the leading producer. It plans to complete construction of production facilities at the field in 2015 with a view to increasing annual output to five billion cubic meters.

CNPC’s current annual shale gas production does not exceed 100 million cubic meters.