How to reap the rewards of the shale gas boom
The increased role for natural gas consumption is obvious, Warren writes. Smart government policies can play a positive role so society benefits from this once-in-a-century boon.
Unique Energy Opportunity if Smart Policies Continue
In the early part of 2008, I began delving into the big story of the day in North Texas and Dallas, the prolific activity from the recovery of natural gas in the Barnett Shale. At the time, other shale plays were being explored as well, such as the Fayetteville play that confirmed the Barnett’s results; the Marcellus was just being sized up. I was challenged with attempting to figure out how to communicate what shale could be physically described as — in essence, a dead ocean from a geologic perspective.Skip to next paragraph
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Three things came together that gave tailwinds to today’s “shale revolution.” One was that the government stepped out of the way after many decades of nearly regulating natural gas out of existence. It had created artificially low gas prices, which killed production and confidence in the market until the 1980s and ’90s. The second force was the entrepreneurial spirit in oil and gas exploration, which presides in Texas. A powerhouse of expertise exists here, and these newfound unconventional gas production techniques and know-how spread to the rest of the country and the world. For producers, it was their Google moment.
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And finally, technological advances in drilling technology —hydraulic fracturing and horizontal drilling— combined in the Barnett with independent producers’ experimentation, the innovators like Trevor Rees-Jones of Chief Oil and Mitchell Energy. Their efforts, and those of other operators in the 1980s and ’90s, paved the way for the U.S. gas revolution and its ripple effects across the globe. It was the right combination of economics, opportunity and efforts coming together.
Fast forward and there are now 70 shale plays in the U.S. across five major producing regions. The U.S. is thought to have 1,161 trillion cubic feet (tcf) of technically recoverable shale gas resources, according to a May 2013 report from the Energy Information Administration. The Barnett was estimated to hold 39 trillion cubic feet (tcf) of gas around 2006, with remaining reserves estimated at 72 tcf. The Marcellus shale, the largest unconventional gas resource in the U.S., is estimated to have 369 tcf, by comparison. The U.S.consumed roughly 25.5 tcf in 2012.