Shale Gas Essay

3722 words - 15 pages

1. INTRODUCTION

The world is increasingly taking interest in the potential for a shale gas revolution. Australia is no exception to this trend. The key question for Federal, State and Local Government is, assuming a shale gas revolution is seen as desirable, what policy measures maybe taken in order to achieve this end and what should any debate over shale gas policy be focusing upon? This brief paper sets the context of the shale gas revolution. It then outlines the characteristics present in the USA that generated their shale gas revolution. In the context of Australia, there are a great many barriers to reproducing these characteristics. The paper considers what policy options are available to reduce such barriers and lead to an Australian shale gas revolution.

2. THE “SHALE GAS REVOLUTION” IN THE USA

a. A BRIEF HISTORY

The shale gas revolution in the USA is based upon the application of two main technologies – horizontal drilling and hydraulic fracturing (frack ing). Neither is new technology. Horizontal drilling was developed in the 1930s and the first well was fracced in the USA in 1947. The revolution has been reflected in the dramatic increase in the production of shale gas. In 2000 shale accounted for less than 1 percent of US domestic gas production. In 2007 it was 8 percent and only four years later, in 2011, it was 30 percent. However, a key point is that this American “revolution” in reality happened over a long period of time – well over 20 years in the making, although it is only in the last five years or so that the share of shale gas in domestic production has increased significantly. Furthermore, this growing role of shale gas is expected to continue. The EIA suggests shale gas will supply 42 percent of domestic gas production by 2040 and another source puts shale at over 50 percent by the 2030s .

b. THE IMPACT IN THE USA

The impact of this shale gas revolution has been significant . The most obvious impact has been on USA domestic gas prices as can be seen from Figure 1.

Figure 1


Source: US Energy Information Administration.

This dramatic fall in gas prices has had several important effects. It has led to a significant revival in USA petrochemical and other gas intensive manufacturing industries. It has also pushed coal out of much electricity generation, leading to increased coal exports and a reduction in the USA’s carbon footprint. Internationally, it has had a huge impact on the global LNG trade. Between 2005 and 2009, 75 percent of USA LNG regasification capacity was built in anticipation of falling domestic USA gas supplies. By 2011, 90 percent of total capacity was idle. At the same time, LNG export plants which had been built in anticipation of greater US demand suddenly found themselves scrabbling for alternative markets. The result was a potential oversupply of LNG leading to downward pressure on prices .

c. WHY IT HAPPENED IN THE USA

A key question that is relevant to the Australian story...

Find Another Essay On Shale gas

QR Assignment #3

940 words - 4 pages In recent years, it is becoming more apparent that a healthy alternative to the fossil fuels we so frivolously use is now more critical than ever. In 2011, the United States used 18.83 million barrels of raw oil daily, and in 2010 19.18 million barrels of petroleum products and biofuels. In 2010 and 2011, that was nearly 22% of the worlds oil supply. (U.S Department of Energy) Previously inaccessible energy sources such as shale gas methane are

Hydraulic Fracturing: Fracking for a Better World

3582 words - 14 pages sources are developed. One proposed option is shale gas produced through a process called hydraulic fracturing, or “fracking.” But this energy source is highly polarizing, with strong advocates and detractors. While there are many who believe hydraulic fracturing should not be used in the quest for natural resources, the process has a relatively low impact on the environment, and the shale gas that it produces has the potential to change

Safe Unconventional Petroleum Exploration in Tioga County, PA.

1538 words - 7 pages , Gas Companies, and Government. Shale Gas Boom Proceeds amid Human Health Questions: The quick resource boom that started in the early two-thousands that in a few short years exploded into the multi-billion dollar a year business. It is human nature to make money and make it fast. For some they believe too fast. They believe the gas companies are expanding to fast and drilling too much without caring about the consequences on the local ecosystem

Is America Fracking Crazy?

1863 words - 7 pages .  Because of this, the recent development of natural gas extraction from shale rock, by the means of hydraulic fracturing has been discovered. The main objective of the process of hydraulic fracturing is to access oil and gas resources that are locked in non-porous rock (Howarth, Ingraffea, and Engelder 3). The main type of rock surface that is used in this process is shale rock due to its vast amounts of trapped natural gas mostly consisting of

Fracking and its Effect on the Environment

1500 words - 6 pages rising prices of fossil fuels, and there is much potential for recovering natural gas through fracking. However, fracking has many waste products and unusual side effects caused by the unnatural forces and materials used. Fracking has a detrimental effect on the surrounding environment through pollution and earthquakes. Fracking is the process of extracting natural gas from layers of shale rock deep within the earth. One of the world’s largest

Energy Security in Japan

1023 words - 5 pages world. This is very important because the over dependence on import of hydrocarbon will create a very dangerous situation for Japan’s energy security, especially with the current situation where 80% of oil in 2011 are coming from middle east countries. 4. The development of shale gas, shale oil and other unconventional gas (coal based methane and tight gas) will create a significant impact on the world energy market. For example, the shale gas

Hydraulic Fracturing-A Fool's Gold

1018 words - 5 pages Deep underneath The United States are natural gas rich shale formations that contain enough fossil fuels to power America for nearly a century. Big oil companies such as Halliburton have started extracting the natural gases that mainly consist of methane, through a process called hydraulic fracturing. Although it seems like natural gas may save the United States from an energy crisis, many opponents to hydraulic fracturing exist because it

Hydraulic Fracturing: The Future of America’s Energy

1375 words - 6 pages Hydraulic Fracturing, also known as fracking, is not a novel concept. The hope of being able to access fossil fuels trapped inside layers of shale deep beneath the Earth’s surface was achieved by the process of fracking, developed in 1903 (energyindepth.com). Over the last century, hydraulic fracturing has become an efficient and environmentally friendly way to access the natural gas needed to meet the United States’ high demands. With the

Natural Gas is a Viable Alternative Energy Source for Electricity Production

2921 words - 12 pages wells, oil well, shale gas, and coalbed wells (Energy Information Administration (EIA), 2012). Concurrently, the percentage of total gas production from shale gas has been growing rapidly, from 8.1% in 2007 to 34.9% in 2012 (EIA, 2014c). Examining the extraction methods, environmental impacts and the GHG emissions of fossil fuel sources provides evidence for the use of natural gas while cleaner technology is still being developed. The use of

Natural Gas Fracking Risks

1900 words - 8 pages results from the marriage of two technologies: hydraulic fracturing and horizontal drilling. Although these technologies are not new, it was not until 2002 or 2003 that they were first combined” (Edwards and Oliver). “In a typical fracking operation, pressurized water, sand and chemicals are injected into shale rock formations to release trapped natural gas” (Edwards and Oliver). Since natural gas is trapped and then subsequently released from

filling the void

1475 words - 6 pages shaft that can stretch to lengths up to one mile long. A mixture of sand, water, and chemicals are injected in the shaft fracturing the shale formations and release pockets of oil and natural gas. The water is brought back to the surface where the gas and oil is separated out. The issue many people have with fracking is the possible side effects of chemicals used and water contamination. With the use of fracking helping American’s reach energy

Similar Essays

Shale Gas: Changing The Global Energy Market

1137 words - 5 pages It is clear today that for at least the next 20 years natural gas will be a key energy vector in Europe. Increased consumption and reduction of European reserves is pushing countries, governments and companies to all find a more efficient and economically viable energy resource. Like any major new energy source, shale gas has the ability to confer massive wealth on some countries — and take it away from others. It has become a global phenomenon

Impact Of Shale Gas Boom On The Market

1116 words - 4 pages Shale gas has exploded in the North American market. Technology advancements and closing the gap in the days required for in between well moves are making it profitable for owner/operators. Other markets are faced with numerous challenges, and for them this is not the case. What are the challenges that European and Asian markets face, and when will they reap the rewards from their shale rich geologies? Less than 5 years ago, North

Hihi Essay

570 words - 3 pages gas, most of gas in shale reservoirs is absorbed gas. The adsorption and desorption performance affect the ultimate gas recovery. The effect if temperature, pressure, shale composition, pore structure and organic carbon content of the shale on the shale adsorption and desorption performance were experimentally studied and some common conclusions were obtained. Shale gas now plays a significant role in the energy supplies in United States. Shale

Fracking: A Controversial Method For Extracting Natural Gas

2481 words - 10 pages One of the fuels commonly used today is natural gas. Natural gas can be harvested through hydro-fracturing or fracking shale, a type of sedimentary rock. The natural gas is harvested by drilling wells deep into the shale and releasing the natural gas trapped inside. Natural gas has become increasingly important recently and as a result there has been an increased focus on attaining the natural gas through fracking. However, there has been an