This major change comes in the wake of emerging new technologies that are making the extraction of U.S. shale gas more realistic.
According to a recent story in the Financial Times ("U.S. to Take on Rivals in Natural Gas," Oct. 7, 2010), the time may be nearing when U.S. firms are exporting rather than importing natural gas. According to James Crandell, an analyst at Barclays Capital, "North America is gearing up to export gas to the rest of the world," the FT reported.
Moreover, a new report published in September 2010 by the James A. Baker Institute for Public Policy, Emerging U.S. Carbon Management Strategy, suggests:
"Natural gas...stands to play a very important role in the U.S. energy mix for decades to come...By some estimates, a mammoth 1,000 trillion cubic feet is recoverable in North America alone -- enough to supply America's natural gas needs for the next 45 years. The impact of shale gas is already apparent. U.S. import terminals for LNG sit virtually empty, and the prospects that the U.S. will become even more dependent on foreign imports have receded..."To be sure, there are many questions yet to be resolved regarding how the shale gas is extracted -- through a process called hydraulic fracturing that involves using a mixture of chemicals and water under high pressure to fracture the shale deposits where the gas is trapped. But on the other hand, natural gas emits less carbon dioxide than coal and electricity utilities -- not entirely certain whether or when the U.S. might clamp down on carbon emissions -- may begin to lean towards gas if they feel confident the price will not be subject to unexpected spikes.
What might be expected in the short term is a battle waged between coal and natural gas interests, each trying to protect or grow its respective market share for fuel used by electric utilities. The matter of the environmental safety associated with hydraulic fracturing is likely to play a major role in this debate.
Meanwhile, the possibilities related to shale gas are attracting attention in Europe as well as this blog reported on several months ago ("Shale Gas and Europe: The Answer to Europe's Energy Security Issue?" June 29, 2010).
--Don C. Smith