China Coal-Bed Gas Costlier Than U.S. to Drill, StanChart Says

Extracting unconventional gas from coal seams in China is likely to be more expensive than in the U.S. because alternative drilling techniques are required, according to Standard Chartered Plc.

Companies must spend more to extract gas from China’s coal seams because they need to drill horizontal wells, costing about $2.3 million each, in a larger area and through dense deposits, Han Pin Hsi, a Singapore-based analyst, said in a report dated yesterday. U.S. explorers use vertical wells, costing about one-third of horizontal ones, with the fuel concentrated in deeper, smaller areas at a higher permeability.