The Shale Gas Dream: Is it Almost Time to Wake Up?

By John Noël, National Oil and Gas Program Coordinator - Follow John on Twitter (@NoelJohnny) When it comes to the future of energy in this country, you’ve probably heard the terms “shale-revolution,” “bridge fuel,” or “natural gas is our clean energy future.” There are dozens of these buzzwords. Together they form a powerful narrative that, unfortunately, is not really based in reality. Everything we've heard from the gas industry is based on upon projections of an abundant recoverable supply of natural gas for decades to come. The problem is that there are holes in the "lots of domestic oil and gas for decades to come" narrative. Researchers are exposing just how flawed the oil and gas supply predictions are from industry and the leading source for government certified energy forecasts, the Energy Information Agency (EIA) in the Department of Energy. A new report from the Post Carbon Institute investigates drilling data from the top tight oil and shale gas plays. The report very simply concludes that current production projections for tight oil and shale gas are unsustainable and misleading. The report makes a number of clear points:

• Shale gas production will peak in the 2020 range compared to EIA’s prediction of continuing rising production out to 2040.
• EIA has a history of exaggerated forecasts. Just last year the Agency downgraded oil production potential in California’s Monterrey shale by 96 percent. 96 percent! In 2011 they downgraded production in the Marcellus shale by 80 percent
• Production decline rates on shale gas wells are stunning and as a result a greater number of wells and capital investment is required to keep production afloat.

These findings are consistent with a new three year study from a team of researchers at University of Texas in Austin. In a recent article in Nature the leader of the research team, Tad Patzek, indicated that peak shale gas production is closer than originally thought: “That's when there's going to be a rude awakening for the United States.” He expects that gas prices will rise steeply, and that the nation may end up building more gas-powered industrial plants and vehicles than it will be able to afford to run. “The bottom line is, no matter what happens and how it unfolds,” he says, “it cannot be good for the US economy.” Why does this matter? These new revelations are important because the shale drilling bonanza is looking more like snake oil than the real thing. It's happening all across our country from rural Pennsylvania to downtown Los Angeles, but it's been sold to us on a set of principles and projections that may not be true. The so-called revolution is not going to last as long as industry would like and neither will the jobs that would come with it. Many in Congress are pushing to expedite liquefied natural gas export terminals, and we continue the rush to drill without critically assessing the long term impacts that this type of industrial takeover has on public health and the environment. The author, David Hughes of PCI, rightly points out, “Rather than planning for a future where domestic oil and natural gas production is maintained at current or higher levels, we would be wise to harness this temporary fossil fuel bounty to quickly develop a truly sustainable energy policy—one that is based on conservation, efficiency, and a rapid transition to distributed renewable energy production.” How does this relate to Clean Water Action? If you are skeptical about an industry whose primary objective is to instill confidence in its investors about the long term viability of oil and natural gas to keep its stock prices afloat, you are not alone. Clean Water Action understands that increasing the incentive to drill for oil and natural gas is a direct threat to our waterways and public health. We work to reduce the worst impacts of fossil fuels from extraction through distribution around the country. Join us this Tuesday at 5pm PST for a briefing on the groundbreaking report from analysts at the Post Carbon Institute.