The recent press about the potential of shale gas would have you believe that America is now sitting on a 100-year supply of natural gas. It's a "game-changer." A "golden age of gas" awaits, one in which the United States will be energy independent, even exporting gas to the rest of the world, upending our current energy-importing situation.
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What the Frack?
Source: Slate
Author: Chris Nelder
December 29, 2011
The data, however, tell a very different story. Between the demonstrable gas reserves, and the potential resources blared in the headlines, lies an enormous gulf of uncertainty.
The claim of a 100-year supply originated with a report released in April 2011 by the Potential Gas Committee, an organization of petroleum engineers and geoscientists. President and Chairman Larry Gring works with Third Day Energy LLC, a company based in Austin, Texas, that is engaged in acquiring and exploiting oil and gas properties along the Texas Gulf Coast.* Chairman of the Board Darrell Pierce is a vice president of DCP Midstream LLC, a natural-gas production, processing, and marketing company based in Denver. The report's contributors are from the industry-supported Colorado School of Mines. In short, the Potential Gas Committee report is not an impartial assessment of resources.
Its website consists of a single press release announcing the April report, with a link to a brief summary slide deck. A more detailed slide deck issued by the committee presents some optimistic estimates of potential resources, including a "future gas supply" estimate of 2,170 trillion cubic feet (tcf). At the 2010 rate of American consumption—about 24 tcf per year—that would be a 95-year supply of gas, which apparently has been rounded up to 100 years.
By the same logic, you can claim to be a multibillionaire, including all your "probable, possible, and speculative resources."
Assuming that the United States continues to use about 24 tcf per annum, then, only an 11-year supply of natural gas is certain. The other 89 years' worth has not yet been shown to exist or to be recoverable.
Even that comparably modest estimate of 11 years’ supply may be optimistic. Those 273 tcf are located in reserves that are undrilled, but are adjacent to drilled tracts where gas has been produced. Due to large lateral differences in the geology of shale plays, production can vary considerably from adjacent wells.
The EIA uses a different methodology to arrive at its resource calculations, offering a range of estimates. In the most optimistic, "high shale resource case," it estimates there are 1,230 tcf in the “estimated unproved technically recoverable resource base.” It also offers several production forecasts through 2035, ranging from 827 tcf in their Reference case, to 423 tcf in their Low case—one-fourth the headline number. In the Low case, which certainly could be correct, the EIA says the United States could once again become a net natural-gas importer by 2035.
Read rest of the article in Slate
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