OREANDA-NEWS. November 14, 2014. China National Offshore Oil Corp. (CNOOC) is approaching foreign companies to help develop its first onshore shale gas block in China’s eastern province of Anhui.

CNOOC is looking for foreign investors to jointly explore the Western Lower Yangtze block, located within the boundaries of the city of Wuhu, two sources with the NOC told Interfax.

CNOOC’s Shanghai branch, in charge of developing the block, has been tasked with finding a foreign partner, said Gao Xiaotian, vice president of CNOOC’s Unconventional Energy Institute.

CNOOC is open-minded about what form the venture could take. It could sign a production-sharing contract (PSC) or even farm out some of its stake, said another source, who did not wish to be named.

Shell remains the only foreign company to have signed a shale gas PSC in China, partnering China National Petroleum Corp. at the Fushun-Yongchuan block in the Sichuan Basin. Other IOCs – including ExxonMobil and BP – have signed joint study agreements (JSAs) for shale blocks with China’s oil giants, but none have advanced to the PSC stage because of reservations about Chinese shale.

Shell signed a JSA with CNOOC for the Anhui block in October 2011, but decided to exit the project in June 2013, Shell spokesperson Shi Jiangtao told Interfax on Friday. “We concluded the joint study in Anhui and jointly decided to not pursue further.” The IOC regarded the geology as too complicated, said the unnamed CNOOC source.

Shell is now focused on its project in Sichuan and will not consider investing in the Anhui block, said Zhang Yancai, a senior adviser with Shell in China.