Shale Gas Opportunities for US Independents in China?

Toshi Yoshida, corporate and energy partner at the law firm of Mayer Brown LLP, recently told E&P Online that China's shale gas development holds significant opportunity for U.S. independents who have extensive experience in developing America's shale gas resources. Read here.
I would caution that there are significant risks in such ventures: First, energy is a "strategic sector" in China so that foreign participation is curtailed. Note that so far no foreign companies have been allowed to bid on shale gas lease auctions in China, even as minority partners to Chinese firms. There have been suggestions that this might change, but still with foreign companies as minority partners. Second, Chinese hypersensitivity in this sector was amply demonstrated by the imprisonment of U.S. geologist Xue Feng for espionage for acquiring Chinese geophysical data that anywhere else would be considered purely commercial. Third, China's new regulations have increased pressure on foreign firms to provide Chinese partners with proprietary technology as a requirement of market entry; and China's long-standing failure to protect intellectual property is well documented. Finally, as the recent Yahoo-Alibaba/Alipay case demonstrated, dealings with a Chinese partner may be less than transparent and foreign partners cannot expect protection under the Chinese legal system. So I would strongly suggest that U.S. independents carefully weigh the considerable risks against any possible rewards before investing their capital (financial or intellectual) in China. [Disclosure: I own stock in Chesapeake Energy and Devon Energy.]