Never mind the horrendous air, water and soil pollution. Never mind the intrusive and dangerous infrastructure. Never mind the loss of property and property values. It’s damn hard to make money on shale gas.
The shale gas fairytale continues
By John Dizard
Published: July 18 2010
Yes, shale gas is there, but it is expensive to produce, and there is much, much less of it available at today’s low prices than policy people, investors, and energy consumers are counting on. It is not a cheap and simple way to replace coal (in America), or Russian gas supplies (in Europe). I am, however, humbled in the presence of the marketing genius of the promoters who have convinced so many people to buy the story.
We are wasting good water and contaminating what’s left, spoiling our air and soil for something that lasts about as long as a kitten’s life.
One large German bank’s commodity group is developing its own estimates of the average economic life of shale fields; they think 10 years is a reasonable assumption. That is close to what Arthur Berman, a sceptical Houston geologist, thinks is reasonable. As Mr Berman says: “Unconventional gas has at least twice as fast a decline rate as conventional resources. About 85 per cent of the value of shale wells in the Barnett will be produced in the first 10 years.”
A conversation about shale gas on The Oil Drum.