Friday, October 13, 2017

Natual Gas Projections:

Revisiting Conventional Wisdom

Just when you think you have a good handle on the facts, along comes a study that casts doubt on some of the "conventional wisdom."

At least, that was my reaction when I read a summary of two recent reports on natural gas projections.  Among the "blockbuster" findings were the following:

  • Fracking and drilling are not playing nearly as large a role as thought in boosting oil and gas production from shale,
  • Technology's role has been overstated by as much as 50 percent,
  • As prime drilling spots get used up, technology may not be able to counter the loss in productivity from shifting to less desirable locations,
  • And perhaps most surprisingly, the land-use needs of natural gas are similar to wind and solar production, at least in some locations. 
 I hasten to note that these are newly published results and it will be interesting to see the response to them.  In the first place, both studies looked at specific geographical areas, so it will be important to see if the results are typical of other areas.  Also, there may be ways that some of these concerns can be addressed.  The article hints at that, noting in particular that there are ways to decrease the land-use footprint.

However, the two studies do point to the fact that, once again, we find ourselves making greater use of a well-known technology, and suddenly finding that scaling it up introduces unforeseen problems.  Given the growing importance of natural gas in our energy use, it will be important to explore these issues further.  For one thing, the fact that productivity may decrease over time will result in higher gas prices, and thus our growing dependence on natural gas may cost us dearly in the future.

This, to me, reinforces the argument that it is important to maintain a diverse energy supply, and that energy policy should recognize this and incorporate measures to assure that we maintain a healthy mix of energy sources over the long term, including both nuclear power and renewables.


1 comment:

  1. I'd like to share 2 comments I got on LinkedIn that point to other reasons that the supply of natural gas may decrease in the future:

    From Robert Margolis:

    I understand much of the current cheap gas is the associated gas from the Permian Basin (i.e., gas released from hydraulic fracturing of oil, thus the oil drilling "pays" for the gas). Not sure how long these reserves will last, but their depletion may change the natural gas picture.

    From William Jensen:

    This isn't the 1st time there's been a boom/bust in NG, and likely won't be the last. Hydraulic fracturing has been a great boon, but at some point the NG will play out.

    --Thanks to both commenters for their very helpful additions to the discussion of this issue. Gail Marcus