We read with interest in many recent publications that unconventional gas / shale gas is the future of the energy industry. European Oil & Gas has an article full of promise for the resource whilst others treat it with a little more caution. Oilfield Technology talks of Poland’s initial enthusiasm yet we hear that their findings so far have been economically unviable. Outside of the US, who have embraced the resource, Australia hold one of the largest reserve and they too are questioning economic viability.
In this week’s news we see that DNV have launched a Recommended Practice for the entire life cycle of shale gas extraction, based on risk management principles. We wonder whether sceptical countries such as Germany – who question the use of acid fracking and its impact on the water course – will be influenced or ever make the move to this source or will the Recommended Practice merely fuel the speculation as to whether at this moment we have the required technology for its safe extraction? Have the US simply ignored these questions and ploughed ahead as their access to conventional resources dwindles further?
Our feeling is that shale gas will have to be utilised but when this happens will depend heavily on new cleaner fracking technologies. As for the short term the cost of extraction verse the current price of conventional gas will continue the hold back any serious extraction outside of the US and China who are already offering subsidies to operators for some time to come.