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Thursday, December 4, 2014

Researchers predict shale gas bubble - UPDATED, AGAIN...AND AGAIN

A team of petroleum engineers at the University of Texas at Austin has found that, contrary to Federal government estimates, Marcellus Shale production could peak in just five years, plateau, and then tail off quickly.

The results were reported in the journal Nature, and summarized by StateImpactPA:
shale gas production among the big four plays, including the Marcellus, is expected to level out in 2020. The EIA forecasts a shale gas plateau in 2040…
Bursting shale bubble predictions are not new. But the article may be the first to compare the government’s analysis of data with academic results.
“What we found surprising is that the best academic estimates that are being done today are more pessimistic than the best information used by the U.S. government,” said Rich Monastersky, an editor for Nature.
The news could put policy makers in a bind when it comes to making decisions on everything from projected state revenue to Philadelphia’s plans to become the East coast “energy hub.”
The bottom line?
“What this article shows is there’s a considerable amount of uncertainty in how much natural gas will be produced in the future in U.S. shale formations,” said Monastersky.

Dec. 16, 2014 update: EIA has responded in a letter to Nature that the article "provides a very misleading view of this important subject."

Dec. 18, 2014 update: Nature fires back.

Dec. 19, 2014 update: Petroleum geologist and energy consultant Arthur Berman weighs in on the side of the Nature piece.

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