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From " Daily Oil" in OK. They're highlighting the economic and even geopollitical importance of shale gas:
The rapid growth of US shale gas production has already had a big impact on the domestic gas market, but a new report from the Baker Institute on Public Policy highlights important geopolitical consequences of the US shale gas boom: a weakening of Russia's ability to use natural gas as an "energy weapon" against Europe, and a similar erosion of Venezuela and Iran's "petro-power."
The Baker Institute, affiliated with Rice University in Houston, forecasts that US shale gas production will more than quadruple over the next three decades from its 2010 rate of roughly 10 billion cubic feet per day, and will comprise more than 50% of the US natural gas pool by the 2030s.
Consequently, significant volumes of liquified natural gas (LNG) that had previously been expected to head toward the US in the coming decades will now be displaced to Europe.
That shift in supply, the study found, should translate into a meaningful reduction in Russia's share of the West European natural gas market -- from 27% in 2009 to as little as 13% by 2040.
Furthermore, the impact is expected to extend to Iran and Venezuela, two countries that have also sought to flex their geopolitical muscle through increased participation in the global gas market.
The Baker Institute estimates that Russia, Iran and Venezuela would have accounted for 33% of global gas supply in 2040 if the US shale revolution had not occurred. However, it now expects their share to amount to 26% in that year.
The study, funded by the US Energy Department, also found that the reduced need for imports of LNG would be beneficial for the US trade balance, the economy as a whole and for national security.
"Increasing US exposure to events in the Middle East or Russia through rising purchases of imported LNG is a less desirable outcome than being able to rely on domestic energy supplies," the report stated. "Thus, to the extent that natural gas supplies can be sourced from North America and not in the form of imported LNG, the United States is -- all things considered -- better off."
While the staying power of the US shale gas boom has been questioned in recent months, the authors of the Baker Institute study argue that shale gas is sustainable and that production will continue to expand in the coming decades (OD Jun.28'11).
"The idea that shale gas is a flash-in-the-pan is simply incorrect," said Kenneth Medlock, a co-author on the study. "The geologic data on the shale resource is hard science and the innovations that have occurred in the field to make this resource accessible are nothing short of game-changing"
(OD Jul.7'11).
In addition to tipping the scales in the global marketplace, the report also suggests that the boom in US shale production could have positive repercussions for the nation's quest to reduce its carbon footprint. By creating greater competition among global gas suppliers, shale gas will lower the cost to average Americans of reducing their greenhouse gas emissions.
"Natural gas stands to play a positive role in the global energy mix, making it easier to shift away from more polluting, higher carbon-intensity fuels," the report states. "To tap this benefit, it will be essential for the United States to promote a stable investment climate with regulatory certainty."
The rapid growth of US shale gas production has already had a big impact on the domestic gas market, but a new report from the Baker Institute on Public Policy highlights important geopolitical consequences of the US shale gas boom: a weakening of Russia's ability to use natural gas as an "energy weapon" against Europe, and a similar erosion of Venezuela and Iran's "petro-power."
The Baker Institute, affiliated with Rice University in Houston, forecasts that US shale gas production will more than quadruple over the next three decades from its 2010 rate of roughly 10 billion cubic feet per day, and will comprise more than 50% of the US natural gas pool by the 2030s.
Consequently, significant volumes of liquified natural gas (LNG) that had previously been expected to head toward the US in the coming decades will now be displaced to Europe.
That shift in supply, the study found, should translate into a meaningful reduction in Russia's share of the West European natural gas market -- from 27% in 2009 to as little as 13% by 2040.
Furthermore, the impact is expected to extend to Iran and Venezuela, two countries that have also sought to flex their geopolitical muscle through increased participation in the global gas market.
The Baker Institute estimates that Russia, Iran and Venezuela would have accounted for 33% of global gas supply in 2040 if the US shale revolution had not occurred. However, it now expects their share to amount to 26% in that year.
The study, funded by the US Energy Department, also found that the reduced need for imports of LNG would be beneficial for the US trade balance, the economy as a whole and for national security.
"Increasing US exposure to events in the Middle East or Russia through rising purchases of imported LNG is a less desirable outcome than being able to rely on domestic energy supplies," the report stated. "Thus, to the extent that natural gas supplies can be sourced from North America and not in the form of imported LNG, the United States is -- all things considered -- better off."
While the staying power of the US shale gas boom has been questioned in recent months, the authors of the Baker Institute study argue that shale gas is sustainable and that production will continue to expand in the coming decades (OD Jun.28'11).
"The idea that shale gas is a flash-in-the-pan is simply incorrect," said Kenneth Medlock, a co-author on the study. "The geologic data on the shale resource is hard science and the innovations that have occurred in the field to make this resource accessible are nothing short of game-changing"
(OD Jul.7'11).
In addition to tipping the scales in the global marketplace, the report also suggests that the boom in US shale production could have positive repercussions for the nation's quest to reduce its carbon footprint. By creating greater competition among global gas suppliers, shale gas will lower the cost to average Americans of reducing their greenhouse gas emissions.
"Natural gas stands to play a positive role in the global energy mix, making it easier to shift away from more polluting, higher carbon-intensity fuels," the report states. "To tap this benefit, it will be essential for the United States to promote a stable investment climate with regulatory certainty."
