Unconventional gas fuelling the future
The huge potential of uncoventional gas will reshape the global gas industry
By NJ Watson
Unconventional gas is set to reshape the global gas industry, making long-term supply and price forecasts difficult, keynote speakers told the WGC yesterday.
The magnitude of the world's estimated 900 trillion cubic metres of unconventional gas "changes any long-term view on the industry", Antonio Brufau, executive chairman of Spain's Repsol, said here yesterday.
And, speaking at Tuesday's WGC luncheon, StatoilHydro's Rune Bjornson, executive vice-president of natural gas, said advances in the unconventional-gas business were tantamount to a "revolution" – and one poorly understood outside the industry.
The US Energy Information Administration forecasts that unconventional sources will meet 56% of US supply by 2030, up from 27% in 2000. And the rise of unconventional gas will occur elsewhere too, with particularly good growth prospects in Australia and China.
Until only recently, unconventional gas resources were not regarded as particularly important, even if the industry knew that their theoretical potential was enormous. "The common wisdom was that [unconventional gas] was too difficult, too expensive and too demanding," said Bjornson. "This has changed."
The rise of unconventional gas has significant implications for the gas industry; resources are now far more plentiful than ever imagined and will available for generations to come. "If we ever doubted that gas was the fuel of the future – in many ways there's the answer," said Bjornson.
Unconventional gas will also create new breed of producing countries with the potential to change radically the regional supply/demand balance – as it has in the US.
But both speakers said unconventional gas remains – for now – exactly what its name suggests.
"The marginal cost of unconventional gas is not set in stone," said Brufau. "It depends on access to land and water, environmental policies, cost and technological development."