Honghua Group Ltd., China's largest exporter of oil-drilling equipment, plans to invest up to 100 million yuan ($16 million) by the end of the year in a shale gas exploration project.

The investment will go to the manufacture of sample equipment and to system tests in both the United States and China.

"The development of shale gas in the United States will enter a boom period in two to three years, when our company will embrace a great sales opportunity," said Zhang Mi, Chairman and President of Honghua Group.

"In the future, other countries, including China, India, Poland and Argentina, will develop shale gas markets on a large scale, which will also bring us business opportunities. We're just getting ready now."

Honghua is based in Chengdu, Sichuan Province, which contains a rich supply of shale gas. Honghua has been doing business in the United States since 2004 and has opened two factories in Houston, Texas.