Feeds

Hot air: Energy industry talks shale gas

A revolution 50 years in the making?

Providing a secure and efficient Helpdesk

With standing room only for Future Energy Strategies' seminar on shale gas last week, there's no doubt what the big excitement in energy is right now. Shale... It's the new thorium!

This is all a bit strange for something that relies on a technique that's 50 years old. Shale gas drilling licences were snapped up in 2002, and two years ago, production began to tip market prices significantly for both gas and oil – the two diverged for the first time ever. Yet still, news hadn't broken beyond the trade silo, for the political classes to digest the implications.

Shale gas relies on the combination of two techniques – horizontal drilling and the hydraulic fracturing of rock. The rock is blasted using a liquid that's usually water with sand and a cocktail of lubricants added. The drilling goes deeper (7,000 to 12,000m) to draw the gas up from impermeable rock.

At the seminar we heard from a skeptic, a proponent, and a practitioner who has been setting up wells (they still call them wells, naturally) in Poland for five years. There were also some interesting exchanges with a couple of professional environmentalist campaigners.

Gas markets consultant Leigh Bolton of Holmwood Consulting gave a wary view of shale's prospects. It was a comprehensive catalog of concerns, focusing on the difficulties of drilling and uncertainty of return, rather than eco-alarmism. Bolton said that the European experience of shale would be very different to that of the US. Partly this was because of the high population density, but also because of red tape, and the lack of a services infrastructure here. By contrast, the US has a tradition of wild-catting, and established services pop up as soon as excavators need them. This means higher costs.

Bolton reckoned the new shale plays require a gas price of $6 MMBtu (per million Btu), whereas the US gas price is closer to $4.5 MMBtu. "The liberalised market price in Europe won't match it for many years," he predicted.

Nobody could be more bullish than long-time advocate Nick Grealy, who has been both an energy provider and buyer (for the NHS) in his time. In 2008 he started the No Hot Air blog, before most people here had heard of shale.

The case for shale

Grealy began by ridiculing the current political wisdom. He quoted Energy secretary Chris Huhne, who had declared that "Left untouched, the electricity market would allow a new dash for gas, increasing our dependence on a single fuel, and exposing us to volatile prices".

That's rubbish, he said, because we'd be able to generate our own gas so cheaply, in such abundance. Grealy described gas as the cheapest low-carbon fuel source, winning support from eco-warriors ranging from the Sierra Club to The Hon Sir Jonathan Porritt.

The figures sound impressive.

One field alone in populous Texas, Barnett Shale, has produced 226bn cubic metres (BCM) since 2004. The UK needs to import 10.4bn cubic metres of gas. A few fields here could see Britain exporting LNG – something the US shale producers are already doing in volume. He said every pessimistic estimate to date had been proven wrong – the recoverable reserve estimates in Argentina and India had grown tenfold and twentyfold respectively in just two years.

"The UK's energy policy depends on the perception of insecure and expensive gas. Instead we have expensive solutions to a problem we'll no longer have."

Exploiting the UK's shale could bring in a 5550 per cent reduction in CO2 emissions by 2020 2025, at no cost in subsidies or higher energy bills. Attempts to pursue low-carbon strategies by other means were vain, he said.

"Why give people a £5,000 subsidy to buy an electric car to assuage their guilt for working in the City?" he asked the City audience.

Internet Security Threat Report 2014

More from The Register

next story
MARS NEEDS WOMEN, claims NASA pseudo 'naut: They eat less
'Some might find this idea offensive' boffin admits
LOHAN crash lands on CNN
Overflies Die Welt en route to lively US news vid
Comet Siding Spring revealed as flying molehill
Hiding from this space pimple isn't going to do humanity's reputation any good
Experts brand LOHAN's squeaky-clean box
Phytosanitary treatment renders Vulture 2 crate fit for export
No sail: NASA spikes Sunjammer
'Solar sail' demonstrator project binned
Carry On Cosmonaut: Willful Child is a poor taste Star Trek parody
Cringeworthy, crude and crass jokes abound in Steven Erikson’s sci-fi debut
Origins of SEXUAL INTERCOURSE fished out of SCOTTISH LAKE
Fossil find proves it first happened 385 million years ago
Human spacecraft dodge COMET CHUNKS pelting off Mars
Odyssey orbiter yet to report, though - comet's trailing trash poses new threat
prev story

Whitepapers

Forging a new future with identity relationship management
Learn about ForgeRock's next generation IRM platform and how it is designed to empower CEOS's and enterprises to engage with consumers.
Why and how to choose the right cloud vendor
The benefits of cloud-based storage in your processes. Eliminate onsite, disk-based backup and archiving in favor of cloud-based data protection.
Three 1TB solid state scorchers up for grabs
Big SSDs can be expensive but think big and think free because you could be the lucky winner of one of three 1TB Samsung SSD 840 EVO drives that we’re giving away worth over £300 apiece.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
Security for virtualized datacentres
Legacy security solutions are inefficient due to the architectural differences between physical and virtual environments.