ON A HAZY MORNING LAST SEPTEMBER, 144 American and Chinese government officials and high-ranking oil executives filed into a vaulted meeting room in a cloistered campus in south Xi'an, a city famous for its terra-cotta warriors and lethal smog. The Communist Party built this compound, called the Shaanxi Guesthouse, in 1958. It was part of the lead-up to Chairman Mao's Great Leap Forward, in which, to surpass the industrial achievements of the West, the government built steelworks, coal mines, power stations, and cement factories—displacing hundreds of thousands and clearcutting a tenth of China's forests in the process. Despite its quaint name, the guesthouse is a cluster of immense concrete structures jutting out of expansive, manicured lawns and man-made lakes dotted with stone bridges and pagodas. It also features a karaoke lounge, spa, tennis stadium, shopping center, and beauty salon.
The guests at the compound that week were gearing up for another great leap: a push to export the United States' fracking boom to China's vast shale fields—and beyond. Attendees slid into black leather chairs behind glossy rosewood tables, facing a stage flanked by large projector screens. Chinese b...
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