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.
The Shale gas economic shell game
About Sharon Wilson
Sharon Wilson is considered a leading citizen expert on the impacts of shale oil and gas extraction. She is the go-to person whether it’s top EPA officials from D.C., national and international news networks, or residents facing the shock of eminent domain and the devastating environmental effects of natural gas development in their backyards.
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According to Railroad Commission production data, the average well life in Barnett shale is about 7 years with most of the production over by year 5. The operators told us 30-40 years but that is not what the Railroad Commission data is showing. Dizard is right. This has been a total hype job from day one. Wall Street bought into it and pumped millions and millions if not billions of dollars at these companies and it was all "smoke and mirrors." Some analysts are now referring to it as the next mortgage backed securities bubble.
Chesapeake increased frac stages 46% last year for a sorry 10% increase in initial production. That means they ruined forever a whole lot of OUR water for virtually no more gas. Thank you, Barnett Shale for squandering our birthright.
This point about all of this being just another "shell game," is the biggest point of all. When people are most vulnerable the vultures all show up to finish us off. The very people who made sure that Dick Cheney and George W. Bush held office are the very ones who have done this to us. Shame on all of them.
I really wish people would pay attention to this. It smells just like the mortgage bank scam. We will ruin our water and land for nothing.
PLUS if people would only consider the devaluation of their property and weigh that against any royalties, they would see that unless they own considerable acreage they will come out in a big sink hole financially.