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‘Unconventional wisdom’: French think tank says shale revolution isn’t big for US and Europe

Published time: February 14, 2014 15:51
Reuters / Jason Cohn

Reuters / Jason Cohn

The impact of a shale boom on Europe is exaggerated, and it isn’t driving “an overall manufacturing renaissance in the US,” says the French Institute for Sustainable Development and International Relations (IDDRI)

The shale boom the US has positively affected the gas industry and local economies, while the influence on macroeconomic growth was insignificant, according to an IDDRI report called “Unconventional wisdom: an economic analysis of US shale gas and implications for the EU.”

The dramatic reduction in US natural gas prices does not appear sustainable the long term. After the price collapse to $1.95/Mbtu at the beginning of the 2012 prices have climbed back to $4.69/Mbtu in January 2014. In the long term the United States will remain a big importer of crude oil, and the price for 1 Mbtu will reach $6-10, the study forecasts.

According to the IDDRI analysis the advantages for Europe will be even less, because of environmental concerns and restrictions on exploration.

"It is often overlooked, but the US shale revolution came after several decades of geological exploration which scaled up massively in the years preceding the boom," IDDRI said.

Seeking shale deposits the US drilled a total of 17,268 exploratory natural gas wells between 2000 and 2010, an average of 130 wells per month. In the EU it's much less with 50 wells in total, and it’s still in shale exploration infancy.

The study projects from 3 to 10 percent coverage of EU energy demand, coming from shale resources by 2030-2035.

"Shale gas should therefore not be seen as a solution to the EU's energy, climate and competitiveness challenge," the think tank said.

IDDRI believes the European Union should follow energy efficiency and eco-innovation strategy, use low carbon sources and maintain a more integrated internal market.

It added, "Shale gas could be a complement to this, in so far as it could contribute to a more liquid, resilient internal gas market, particularly in those member states currently highly dependent on polluting coal or Russian gas."

Comments (6)

 

T J 17.02.2014 19:30

It's energy at all costs, no matter what.
They build nuke plants with out having any clue as to stop an accident (fukashima)
They drill for oil at the bottom of the Gulf of Mexico with out having the technology to stop a leak so former fishing grounds are ruined for generations.
Now they are fracking, pumping chemicals deep underground in order to get the gas to come out, ruining the ground water for millions.
Why are we so addicted to our Western way of life that we would allow our oceans, lands and food supply to be ruined for our children and their children?

 

Ally Hauptmann-Gurski 16.02.2014 04:45

In the long run, fuel from algae is probably the only solution. It absorbs CO2 until it is burned and the next algae crop will absorb it again. Algae can even be produced with seawater.

But it can't come in before the investors in fracking have pocketed their profits.

Ru ssia wants to be a reliable partner for Europe but some jokers stir all the time, even plan competition from Qatar through instable countries, and do everything to destabilise Russia.

 

JAFO 15.02.2014 00:37

james ford 14.02.2014 22:22

North and South America will be self sufficient in gas and oil by 2030.

  

[q uote name='free-world-log ic' time='14.02.2014 23:09']...as the US became the largest natural gas producer in the world.[/quote]

Bwaaaaaahaaaaaha aahaahahahaha!

You need to read the latest studies.. the shale wells are going to start drying up in two years. There is far less recoverable oil and gas than was claimed. It was all just a scam to sucker in investors.

Shell has already sold off most of its' leases.. they've done the math, and they know unconventional is a loser.

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