Alberta's Peter Tertzakian is an energy guru of long standing who has been consistently ahead of the curve on shale. Always worth listening to, this is his take on the EIA global figures of earlier this month:
Of late, the conference circuit is signaling a new megatrend: international shale gas. Invitations to attend events in Europe, Asia, Australia, and just about anywhere except price-depressed North America, are popping up in email inboxes. Those in the natural gas business have surmised that the shale revolution would eventually proliferate around the globe; now it’s starting to happen. And if North America is even a small proxy for the rest of the world, the implications will be quite profound.
How big is a TCF? The UK used 2.4 TCF in 2009 for comparison purposes. The United States uses about 20 TCF. So any notion that we are going to run out of natural gas is not based on reality.
We could have a debate on what is the difference between technically recoverable or proven But that seems rather pointless, they are both massive. Whether we have enough gas for 500 years or merely 50 shouldn't change the debate here. As a for instance, the US Potential Gas Committe report from yesterday stated that US shale gas reserves had from 615 to 689 TCF or over 12% in two years. One has to understand that during those two years, the use consumed 40 TCF to understand that the resources aren't receding. My only quibble with the PGC study is that the impact of the Marcellus in Pennsylvania is most likely understated. The amount of gas there is likely to become increasingly clear over the next two years.
I see three major issues worldwide:
1. Even in the US, there are many still unaware of the impact of such massive quantities. In Europe, the conventional wisdom remains in denial about the impact of shale, in large part because it disrupts every high priced "solution" to an energy crisis that we don't have. As the size of the world's resource grows and reality starts to sink in, shale is going to move from a sideshow to dominance.
2. A key issue will be to demonstrate that shale is environmentally sound. The enemies of shale have very different motives but the same target. First they denied that shale was economic or even existed. Now, in order to protect their customer base built on energy as a problem, they exaggerate the environmental impact with junk science. They also take advantage of fear of the unknown. A key disruption of shale is that gas extraction is going to move into areas with no history of oil or gas extraction. The high priced solutions to problems we no longer have have been many people's meal ticket. They have a vested interest in making sure the public continues to fail in understanding shale The reality of shale is that it is here, scalable, plentiful, secure and cheap. One thing that needs to be stressed in any dialogue is that the opportunity cost on the economy and the planet of NOT taking advantage of gas is likely to be far more harmful to both than going forward with gas.
3. Moving forward, the issue of gas is about building demand, not supply. That is a sudden, disruptive shift which will confuse, or even scare many people. In a society where people can be made to believe in almost anything, no matter how far-fetched, as the Birther movement has shown, the battle for public acceptance will be a bit more nuanced than hoping that facts push out fear. We have to make shale not simply legal, but legitimate. Then we can get down to enjoying the benefits of shale in generation, LNG exports and transportation.