Royal Dutch Shell is in talks with PetroChina and Hess Corp about drilling for shale oil in the Santanghu bay in north-west China, PetroChina announced on Thursday.

The three companies are still discussing how to divide up the work and the targets for the exploration period. Thirty-five explorative drillings have been done and oil found in half of them
Last month, Shell signed a contract with China National Petroleum Corp, which owns PetroChina, for joint drilling for shale gas in the south-western province of Sichuan.
Shale gas and oil is obtained by a method known as fracking. It involves high-pressure water creating slits in the shale through which the gas or oil can be extracted.