Shale gas buried underground is estimated to increase recoverable gas in the world by 50%. Shale oil would allow oil reserves to expand by 10%. The US Energy Information Administration changed its estimates after a new study where it took into account twice as many oil and gas fields than in 2011.
The story of U.S. natural gas gets referenced a lot but you may not know whats going on. Here are 15 charts that tell the story of the U.S. natural gas market which has been completely changed by the rise of horizontal drilling and hydraulic fracturing.
In the past few years, new technologies and cheaper costs allowed producers to access gas trapped in parts of the U.S. previously considered unreachable.
Japan, the world’s biggest importer of LNG, pays about $18 per British thermal units, versus$10 in Europe and $3~4 in the U.S. It is tired of paying such a price for a resource that has become so important. So Japan is preparing to launch the first LNG futures market.
The low price in the U.S. is due to the shale gas boom in the country and to the fact that the gas does not need to be liquefied. In Europe, there are spot markets for LNG which constantly take into account the state of supply and demand.
Unconventional treasure: Shale gas is trapped deep inside rock formations.
Shale gas is a new and abundant source of natural gas, trapped in rock formations. Oil companies have known about it for decades but always dismissed it because it was too expensive and difficult to extract.
In the past few years new technologies that pump water underground to fracture the rock and free the gas have been perfected. The breakthrough has opened a new frontier for the energy industry and turned long-held assumptions about the world’s dwindling supplies on their head.
via Shale gas blasts open world energy market on Propurchaser
The energy revolution experienced by the United States for the past ten years will not come to Europe anytime soon. Members of the European Union are indeed very divided on the issue of the exploitation of non-conventional energy resources.
In November 2012, after 3 studies published earlier by the European Commission which concluded that Europe would not reach energy self-sufficiency, the European Parliament invited to comment on the development of shale gas, was unable to pass a binding resolution. In the end, the two resolutions adopted in Strasbourg just called for the Member States to exercise caution in this area because of environmental constraints.
A binding resolution encouraging to explore or exploit shale reserves would probably not have had a majority of votes because of many European MPs opposition, as risks associated with shale gas extraction are not perceived in the same way throughout Europe.
I came across this interesting discussion of the Great Climate Disconnect courtesy of General Electric.
GE has asked the members of its Citizenship Advisory Panel to reflect on trends and key challenges for sustainable development in 2013. This first post by Nick Robins tackles the gap between climate change risk and ambition.
The year ahead will be dominated by growing tension between ever-stronger evidence of climate change and the inadequacy of the global policy response. Drought in the USA in 2012 highlighted the vulnerability of commodity prices to intensified weather risk, and 2013 is set to be another year of above-average global temperatures. But global greenhouse gas emissions are continuing to rise, putting the world on track for overshooting the 2ºC “safe” target and ending up in a 4ºC world.
China seeks to develop its massive shale gas resources. After giving two sets of exploration licenses to oil and gas companies, it hopes to keep the momentum going. The Minister of Land and Resources said he intended to shortly allocate new licenses, without giving any timeframe.
This week, 19 exploration areas were distributed to 16 Chinese companies. Foreign companies were allowed to participate in the auction through joint ventures, but none were successful. The winners agreed to invest at least 13 billion yuan (1.56 billion euros) in the next three years.
Ed Davey, the Secretary of State for Energy and Climate Change, has lifted restrictions on the controversial practice of shale gas hydraulic fracturing, giving a green light to drilling, in a country that consumes the most gas in the EU but where conventional gas reserves are dwindling.
From a net exporter, the UK has become an importer. Promises of shale gas from Cuadrilla Resources, a small British company, could increase energy independence. Some hope that domestic shale gas production could reduce prices by 2% to 4% from 2021. But there is a world between promises and reality.
The European Parliament voted last Wednesday two resolutions calling on the EU countries to exercise restraint on the development of shale gas. It calls for “strong regulatory regimes” regarding hydraulic fracturing, the biggest point of contention regarding the exploitation of shale gas. European countries are advised to be “cautious” when granting new licenses.
This is important, considering that shale gas exploitation has drastically driven US gas prices down and has started to impact other industries. The resolutions adopted in Strasbourg are not binding, and the decision to operate or not unconventional reserves remain under the sovereignty of European Member States. France banned hydraulic fracturing, while Bulgaria and the Czech Republic have declared a moratorium. Poland, meanwhile, will take advantage of its large shale gas reserves to reduce its dependence from natural gas imports from Moscow.