Frack to the Future: Can the Shale Gas Revolution Sustain Itself?

A video circulated recently in which a Fox Business Network analyst made the laughable assertion that Germany’s success with solar power is due to its abundant solar resources (for those missing the humor here, Germany has about the equivalent solar resource of Alaska). While the gaff elicited plenty of chuckles from around the energy sector, the analyst also made another claim that received less attention, but may be similarly incorrect.

Shale gas operations, such as the one above, are multiplying across the U.S. But will unconventional gas resources produce as much energy as is typically touted? (Source: Flickr user Nexen)

In trying to make the argument that the United States should pursue natural gas as opposed to solar power for electricity generation, the Fox analyst states: “Now people are saying, well, solar may be dead in the water. What’s going to happen with nat. gas? You guys know this very well; we have a hundred years of energy.… Let’s take our focus off of solar, let’s move it to nat. gas, and let’s get this economy going.” (We can, for the sake of argument here, ignore the many other nuances in this debate, such as the fact that the U.S. Southwest has some of the best solar resources in the world, and that natural gas and solar are actually complementary technologies and are in no way mutually exclusive.)

The claim that natural gas resources will provide the United States with 100 years of energy is often thrown around (and not just by a fossil fuel-happy news organization like Fox) thanks to recent technological advancements in hydraulic fracturing and horizontal drilling techniques that sparked the so-called “shale revolution.” Shale gas now accounts for almost 40 percent of U.S. natural gas production and has reversed the trend of declining gas production numbers.

However, the estimated amount of natural gas that is available is not a hard number, and the upswing in gas production may not be as long-term a trend as many people believe. In January 2012, the U.S. Energy Information Administration slashed its estimate of unproven technically recoverable shale gas resources by 42 percent. This new estimate, along with proven shale gas reserves, amounts to 579 trillion cubic feet of available natural gas.

At current production levels, this amounts to 24 years worth of shale gas reserves (when combined with conventional reserves, one supposedly gets the nearly 100 years of gas figure). But with consumption climbing, and current production numbers from shale gas plays not as high as predicted, it doesn’t take an energy expert to realize that “one hundred years of energy” calculated from current production and consumption levels doesn’t really hold up in reality.

A recent report [PDF] by geologist David Hughes for the Post Carbon Institute further confronts this idea of a fossil fuel renaissance driven by unconventional resources. Hughes approaches the issue by examining not just the in situ size of resources, but also the probable rate of production, full-cycle costs (including financial and environmental), and the net energy yield of these resources. Hughes concludes, based on examination of production data of tens of thousands of wells, that shale gas and tight oil resources are, “expensive, require high levels of capital input to maintain production levels, and are unlikely to be able to maintain production over the long haul.”

The extent of shale "plays" in the U.S. is impressive, but the production data from individual wells shows high decline rates. (Source: EIA via Post Carbon Institute)

Hughes finds that unconventional gas is unlikely to meet the necessary rate of supply to accommodate business-as-usual, negating the idea that these resources can be counted on as a viable foundation of the energy sector in the long term. And if they were to continue to be pursued, the lower net energy returns inherent with unconventional resources would “mean increasing amounts of collateral environmental impacts.”

The repudiation of the “hundred years of gas” claim isn’t to say that natural gas has no role to play in the overall energy mix, but a reality check is needed before the natural gas frenzy spirals out of control (if it hasn’t already). It is dangerous to assume that unconventional resources can be counted on heavily in the future, and creating a dependence on natural gas, as the Fox analyst proposes, will serve only to prolong the energy issues we currently face.

Yet betting everything on unconventional gas is not that far-fetched for the U.S. energy future, given current political and legislative trends. Beyond the ongoing drilling frenzy, a debate is presently under way that has enormous implications for future gas dependence: the low cost and abundance of domestic natural gas from unconventional sources, as well as high prices in Europe and Asia, are motivating calls to start exporting the fuel.

To export natural gas, it must first be converted to liquefied natural gas (LNG), requiring the construction of expensive LNG terminals. This construction could drive the drilling of tens of thousands of new wells as new markets become accessible, bringing all the attendant environmental impacts and energy security risks, and could lead to sustained high production and drilling in order to recoup the investment in the export terminals.

A U.S. natural gas future isn’t set in stone yet, and alternative development pathways do exist. There will be no silver bullet to meet rising energy demand, but rather a combination of solutions that will result in a much more stable energy sector than the narrow shift to natural gas that the Fox analyst proposed. Hughes advocates, and rightly, that rethinking our consumption habits will be critical to maintaining enough energy resources to go around.

Kevin Doran and Adam Reed, in an article for Yale Environment 360, cite natural gas’s important role in transitioning the U.S. power sector away from coal, but at the same time making sure that natural gas complements and supports a growing share of renewable energy on the grid. A combination of reducing consumption, increasing efficiency, accelerating renewable energy deployment, and thinking critically about the implications of unchecked natural gas development is absolutely critical to avoid future price and supply shocks.

Going all-in on any one energy source is not an advisable course of action, and the potential exists for natural gas and renewables to complement each other in a well-functioning energy sector. It does seem odd, though, that if one were to choose an energy resource based on the amount of time the resource could last, that critics should so readily dismiss the sun—which astronomers give another 5 billion years of existence–in favor of a resource projected to last less than a century.

Reese Rogers is a MAP Sustainable Energy Fellow at Worldwatch Institute.

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