The potential of extracting gas from shale continues to attract considerable attention all around the world. Also referred to as "unconventional gas resources," shale gas remains a mystery to many. However, that's likely to change in the near term as projections of huge amounts of shale gas in the U.S., Europe, and elsewhere are published.
Most recently shale gas is being called an energy "game changer" by some including Nick Butler, chair of the King's College London Policy Institute, who wrote recently that shale gas will likely "transform" energy markets.
Writing in the Financial Times ("How Shale Gas Will Transform the Markets," May 9, 2011), Mr. Butler said, "High energy prices and political uncertainty in the Middle East could now spur many of the world's energy importers [particularly in the U.S. and the European Union] to exploit these new, indigenous gas supplies."
Coinciding with Mr. Butler's FT piece is a new report, Strategic Perspectives of Unconventional Gas: A Game Changer With Implications for the European Union's Energy Security, by the European Centre for Energy and Resource Security, which is also located at Kings College London. According to the report, "The catastrophic events in Japan...as well as the political turmoil in North Africa and the Middle East [are forcing] politicians to rethink how they are achieving their national energy mix."
On the other hand, the report signals caution about the challenges involved with extracting shale gas in Europe: "Various obstacles for European unconventional and shale gas development in particular are in place, preventing the seizure of the full potential of this commodity. Important questions about the future market structure, the regulatory environment, political risk, investor confidence, public acceptance and competition with other fuels -- especially renewables -- need to be answered in the months and years ahead."
Meanwhile, oil derived from shale is also generating considerable interest. A recent article in The New Yorker Magazine ("Annals of Innovation: Kuwait on the Prairie," April 25, 2011) reported that, "Taken together, the new [oil shale] reservoirs [in Colorado, North Dakota, Texas, and elsewhere] are expected to raise domestic production by as much as two million barrels per day." A Colorado Public Radio interview with Jerry Boak, the director of the Center for Oil Shale Technology and Research at the Colorado School of Mines, provides an excellent overview of oil shale. The interview can be accessed by clicking here.
Nevertheless, the extraction of shale gas and oil shale is not without its critics. As the New Yorker article mentioned above said, "Hydraulic fracturing [which is used to extract gas and oil from shale] has become enormously controversial."
Students who attend Denver Law's Environmental and Natural Resources Program will learn about extracting gas and oil from shale. It remains to be seen whether these forms of oil and gas are really "game changers," but to be sure worldwide interest in this method of extraction is growing rapidly and professionals in the oil and gas sector need to be ready to address the opportunities and challenges.