The Ponzi scheme narrative promoted by the NYT gas reporter and the recent Rolling Stone Magazine article took another data hit yesterday, when two new reports put the useable gas from the Marcellus at respectively between 267 to 534 trillion cubic feet (IHS) and 460 to 634 trillion cubic feet (ICF study).
http://www.pittsburghlive.com/x/pittsburghtrib/news/pittsburgh/s_787326.html. Putting together the two reports done by consulting companies IHS and ICF, the range becomes 267 to 634 trillion cubic feet, enough Marcellus gas to meet total US demand for between approximately 10 to 33 years.
While the spread about Marcellus reserves is substantial, it ranges between huge and gargantuan numbers. That is the case, even if one prefers the EIA January, 2012 Marcellus estimate of 141 trillion cubic feet. Indeed, if one assumes Marcellus gas production of 2 trillion cubic feet per year (more than current production but possibly conservative), the Marcellus will be producing gas for 70 years at the low end of the range to more than 300 years at the high end of the range. No matter how one slices or dices the numbers, they are big and extraordinary.
Of course, arguments about reserves are becoming less speculative and even important, as each year of production goes into the history books. Production from shale gas now has a 10-year history, with a shale gas boom since 2007 yielding extraordinary amounts of gas and crashing the price of gas.
Just last night I had a conversation with an earnest young man who had listened to Deborah Rogers, made famous by being featured as a shale gas financial expert in the NYT and Rolling Stones Magazine, and was completely convinced that shale gas is a ponzi scheme. One would hope that when shale gas continues to provide large production for another 5 years that the stake would be driven through the Ponzi narrative.
But probably not. Unfortunately the Ponzi fabrication will likely be repeated indefinitely, as some just want to believe it so badly, and will join the radionuclide poisoning of waters as false statements that never are eradicated.
This is another one of those shale gas stories that media, especially in the northeastern U.S., selectively ignore.
ReplyDeleteWhen the USGS *increased* its Marcellus estimates, but fell short of the latest from the EIA, it was widely trumpeted as a *downgrade* -- even though the two institutions were estimating different things.
These two studies here, I have seen little on -- other than the original Pittsburgh story, and your blog post.
Media people might argue, "Hey, man -- too technical."
But that was demonstrably *not* the case when geologists put out a study that seemed to supply enough backup to give them the headlines, angles, and spin they wanted.
Two things on this:
1) Somebody needs to figure out how to poll Google News, or a similar search engine, on an ongoing basis in order to statistically demonstrate what proportion of the population -- especially the northeastern U.S. population -- is being routinely misled by this sort of bias. Every time I've tried it, the results looked flaky and unreliable, and my queries to others on this seemed to support my hunches.
2) Out of the things this federal administration has tried to do to play a pro-active role in encouraging the environmental safety of and public confidence in hydraulic fracturing, this one seems to have been missed: Making objective, consistent, and publicly accessible the various expert estimates of the available resource.
It should be as important as the GDP, but we leave it to a hodge-podge of disconnected institutions.
This is more like it. After the USGS came out with the low number, I did a quick calculation and came up with >400TCF which is right in the middle of these values.
ReplyDeleteFracking technology will only improve. they expect to recover about 10% of the gas in place with the current approach. If they can get that to 12 or 15% that could conceivably push cumulative production even higher.
john, it's really not a matter of how much gas (everyone knows the gas is there); it's a matter of cost, price, supply, and demand.
ReplyDeleteIf supply outpaces demand and incentives to drill stray too far from market fundamentals, then you might encounter an issue
We are experiencing a glut of cheap gas, just like we have a glut of cheap homes. The more interesting question is how much gas is there at what cost in what time period?
Two points: I agree it is about the price and that the gas is there in huge amounts.
DeleteBut not everyone knows the gas is there. The NYT gas reporter; Rolling Stone Magazine; more than a few people who oppose shale gas development are examples of folks who reject the idea that the gas is there and indeed continue to promote the Ponzi scheme narrative.