Debunking the myth of shale gas

I've recently discussed a report by David Hughes of the Post Carbon institute on my energy blog (see here). The report is called "Drill Baby Drill" and it serves to debunk many of the myths regarding shale gas and tight oil (often referred to as "shale oil").

If you believe the propaganda shale gas / oil "solves" all of the west's energy problems for "a hundred years" (or a thousand years or some other large made up number!)"¦.not so! As this report illustrates shale gas is currently plateauing at an output level of 26 billion cfg/day (about 189 mtoe). Sounds like a lot"¦until you realise that current US gas demand is about 25.4 trillion cfg/yr (or about 60-80 billion cfg/day once you account for seasonal variations). This means that shale gas output within the US can only meet about 37 - 32% of current US gas demand. Total US energy consumption is currently hovering around about 2,200 mtoe. So, neglecting conversion losses and cycle efficiencies (which for certain energy pathways from natural gas to vehicles for example would be significant) you would need to increase shale gas production about 12 fold, just to meet current US domestic energy demand.

Now there may be room for more growth, but it's limited. As I've pointed out in a prior post (see "is shale gas a fracking Ponzi scheme?"), many shale gas "plays" are not economic, often being driven more by market speculation than real world gas demand (a number of the same people behind the sub prime crisis have been getting involved in trading in shale gas "plays"). David Hughes suggests that there may be some room for growth in the form of joint gas and oil fracking operations. Even so, it's worth considering that he also notes how the EIA has been gradually downgrading its forecasts for proven reserves of shale gas. The present reserves estimate of 579 trillion cfg would only sustain current production for about two and a bit more decades. Again in reality it's more likely there there might be some further growth in output, before shale gas peaks and enters into a rapid decline.

Shale/Tight oil isn't much better. They are a little behind shale gas operations, so further growth is likely. David Hughes estimates, based on DoE and EIA figures, that production will ramp up from a current output of 1.2 milion bbl/day to a maximum of around 2.2 million bbl/day in 2017, before declining sharply (of course I'm for hoping it stops altogether!). As with Shale gas, the oil industry has some wriggle room. They may not reach this high point and sustain less output for longer, or they might overshoot (as with shale gas) and sustain a higher output for less time, but that's about it.

Again, 2.2 million bbl/day probably sounds like a lot, until you realise that current US oil demand hovers around 20 million bbl/day (i.e. if Hughes is to be believed the US can only get 11% of its oil needs from tight oil) and global demand is about 80 million bbl/day. It is literally a drop in the ocean, much like the Tar sands I reported on before.

And also like those tar sands Shale gas and tight oil both come with a very heavy carbon footprint, many times greater than that associated with conventional fossil fuels extraction. Shale gas, as I discussed in a prior post may be worse than coal.

In fact a recent joint study by the LSE and the Grantham Research Institute has pointed out that the bulk of the world's existing fossil fuel reserves are essentially "unburnable" if we want to keep global warming to be below the 2 degrees recommended by scientists. Many billions (about $674 billion last year) are being wasted every year on finding or adding additional fossil fuel reserves which we'll likely never use and thus the companies doing so will never recoup revenue from these operations (again it pretty much meets the definition of a Ponzi scheme).

And it's not just the carbon dioxide being released as a result of shale gas production that's the problem. There's also all those nasty chemicals involved in the fracking process and the gas leaking into people's water supply (such that they can actually set their tap water on fire! Watch this video if you don't believe me). In short the advice of the fossil fuel industry to switch from conventional to unconventional fossil fuels is not that far removed from that of a drug dealer telling an addict that the solution to his cocaine addiction is to switch to crack.

It is important as green campaigners we challenge this notion of "shale gas will solve all our problems" mantra, for it is tempting certain individuals (particularly those on the political right) to believe that if we just ignore climate change (which we can't) they can still have their SUV in the drive way and air-con on all night and basically maintain business as usual.

By way of example, I highlighted a while back how the present UK energy policy is founded on the principle that nuclear power will be cheaply available (actually EDF are looking for a subsidy level that exceeds wind power!) and that natural gas from the UK's shale deposits will be cheap and plentiful. Neither of these conditions are likely to apply. Yet even so several major green energy projects, despite making more economic sense than the Tories obsessions with nuclear and shale gas, have been shelved.

The reality is, unconventional fossil fuels are simply not up to the task. While I would accept the argument that the more "pessimistic" peak oil analysts have perhaps underestimated the potential output from these sources, the numbers still do not add up. At best shale gas has bought America maybe a decade or two more of cheap energy addiction. But the come down from the other side of this shale fueled binge is just going to be all that more severe. My advice would therefore be to curtail the use of these sources (if not an outright ban on them) and begin the transition to renewables.

Indeed by contrast to America's shale gas splurge Portugal has succeeded in going to 70% on its renewables consistently over the last winter (briefly 100% at times). Another way is possible!


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D A. Ryan
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