Friday, May 14, 2010

America, Frac Yeah!

There was a fascinating--if perhaps overly optimistic--article in Monday's WSJ on How Shale Gas Is Going to Rock the World:

Over the past decade, a wave of drilling around the world has uncovered giant supplies of natural gas in shale rock. By some estimates, there's 1,000 trillion cubic feet recoverable in North America alone--enough to supply the nation's natural-gas needs for the next 45 years. Europe may have nearly 200 trillion cubic feet of its own.

We've always known the potential of shale; we just didn't have the technology to get to it at a low enough cost. Now new techniques have driven down the price tag—and set the stage for shale gas to become what will be the game-changing resource of the decade.

I have been studying the energy markets for 30 years, and I am convinced that shale gas will revolutionize the industry--and change the world--in the coming decades. It will prevent the rise of any new cartels. It will alter geopolitics. And it will slow the transition to renewable energy.

Those are pretty high expectations, but if we come anywhere close to realizing the potential promise of shale gas we could see them come to fruition. And the world would almost certainly be a better for it.