China's revolution in shale gas is more a distant dream than a work-in-progress. The latest round of bidding on shale-gas licenses shows there is much to be done.

China wants to shift its energy mix to natural gas from coal so that by 2020, 10% of total energy consumption is from gas. That compares with about 4% in 2010, according to Jefferies.

Production is picking up—official data showed Wednesday that natural-gas output jumped 6.7% in 2012 from a year earlier