Despite fracking concerns, experts predict growth in shale gas extraction
|December 15, 2011||Posted by Anharris under Energy|
Despite environmental, cost and market concerns, fracking–the hydraulic extraction of natural gas from shale–is here to stay. That was the consensus of experts who spoke at the British Consulate in Boston on Dec 15 2011.
Sponsored by the British American Business Council and National Grid, the panel included moderator Daniel Goldman, executive vice president and chief financial officer of Great Point Energy; David Hobbes, chief energy strategist for the information/strategy firm IHS CERA; Dr. Elizabeth Kane, first secretary and head of the energy team at the British Embassy in Washington, DC, and Dr. Francis O’Sullivan, research engineer and executivedDirector of the Energy Sustainability Challenge Program, MIT Energy Initiative.
Hobbes described the complexity of shifting international energy markets–pointing out the need to include the costs of extraction and transportation of what otherwise appears to be a low-cost source of energy. He challenged as “shoddy” a recent Cornell University report that extracting natural gas from shale could do more to aggravate global warming than mining coal, and said that it is unfortunate that the study is being used as a basis for US shale extraction policy. He predicted, jokingly, that the UK will come up with “an even stupider policy,” because, as a friend to the US, his homeland “tries to make the US look good,” by comparison.
According to Kane, incentives to invest in shale gas extraction are limited in the UK because the Crown holds mineral rights, because most shale fields are located in densely populated areas (such as under London), and because England does not have the road structure needed to support the fracking industry. Fracking in England was temporarily halted after it was determined that the practice had caused two small earthquakes–but resumed after experts found it was unlikely to cause major quakes, she said. Environmental concerns remain, however; members of a group calling itself “frack off” have chained themselves to fracking equipment to keep it from being operated.
O’Sullivan explained that despite significant shale reserves, few fracking operations are currently profitable because extraction costs are relatively high–but that this will change as technology improves. Regarding environmental concerns, he said it’s unlikely that chemicals used in fracking will leak from pipes into drinking water. In part, that’s because leaky pipes diminish wells’ performance , which provides the industry with incentives to make sure that fracking equipment and wells are tightly sealed. A greater concern is highly polluted “return” water. In Texas, he said, this water is injected into deep sealed aquifer but in Pennsylvania and Western New York State, which have different geologic underpinnings, companies must use other methods to prevent pollution.
O’Sullivan also pointed out that there’s shale to be mined in China, Australia and Argentina–and that the abundance of shale and the possibilities it presents as a source of relatively inexpensive fuel (compared with oil) will impact the global energy market in coming years.
Regarding future markets for natural gas, Hobbes said it’s not likely to be widely used for hybrid electric cars, which are expensive to produce and therefore not popular with consumers. He predicted that the market for shale gas will increase “in little bits and pieces over the next 20-30 years.” Over that period, energy consumption will go down, the US and Canada will add as much oil production as Iran possesses, and Chinese energy demands will optimize the market for natural gas producers in the US, he said.
O’Sullivan predicted growth markets for shale gas in commercial, residential, power, industrial and feed stock uses in the US and elsewhere, and– in light of the recent nuclear reactor failures–in Japan.
–Anita M. Harris
Anita Harris is president of the Harris Communications Group, an award-winning public relations firm located in Cambridge, MA. HarrisCom specializes in integrated strategic communications, thought leadership and content strategy for companies and organizations in health, science, technology and energy, worldwide. She also blogs at New Cambridge Observer.