The USGS increased its estimate of "undiscovered" Marcellus gas reserves by 42 times to 84 from 2 trillion cubic feet, but the NYT reports it as a major cut in the estimates of Marcellus shale gas. How?
The NYT gas reporter and his enabling editors did not realize that the USGS estimate was just of "undiscovered" reserves and did not include discovered or developed reserves, as the EIA much bigger estimate of 400 trillion cubic feet for the Marcellus does.
What is "undiscovered" reserves? It is untouched or not developed gas. See also the fourth comment to the Friday August 26th posting for greater detail on the categories and definitions.
And why did the NYT gas reporter make this fundamental error? He just could not resist spinning the USGS increase as an 80% decrease, since he is pushing the narrative that shale gas is a ponzi scheme.
NYT readers are just pawns in his fictional drama.
I agree; he blew it. I think he caught wind of another journalist who blew it, and just jumped right in without checking his facts (especially since the spin supported his views).
ReplyDeleteThis raises a bigger question though, "What has EIA estimated, and how are these estimates being used in EIA Annual projections?"
EIA has weighed in on technically recoverable resources-all of them. Discovered and undiscovered. Developed and undeveloped. Proved and unproved. The large upward revision in EIA's estimate this year falls into the category of discovered, undeveloped resources.
How reliable are these estimates given we have produced such a small amount of the total gas and the sweeping assumptions made by EIA in its analysis?
My guess? Not very. There is a huge amount of amount of gas, no doubt, just like there is a huge amount of oil in oil shale. Larger resource base, but harder/more expensive to access. How long will the shale gas glut last? Depends on how long the U.S. stays isolated in a domestic market for gas (limits demand and international pricing), and on how many wells industry continues to drill.