Is Shale the Solution to the Looming Energy War ??
Rising shale gas production in the U.S. and Canada as well as potential large natural gas supplies from the United States could be pivotal in curbing Russia’s ability to organize an “energy weapon” against consumers, according to a recently released study by Rice University’s Baker Institute for Public Policy.
The study, “Russia and the Caspian Basin in the World Energy Balance,” examines Russia’s evolving energy relations with its Caspian neighbors, the Organization of Petroleum Exporting Countries and the West and considers potential scenarios for Russian and Caspian oil and natural gas strategies.
“Maintaining favorable tax conditions to support investment in onshore shale gas resources in the United States can play an important role of containing Russia’s leverage over an increasingly global natural gas market,” said Kenneth Medlock, a Baker Institute researcher and lead author of the study. “In addition to North American resources, our scenario analysis shows that there are several supply sources that can serve as viable alternatives to heavy future global reliance on Russian natural gas.”
Medlock said that Russian efforts to organize a “gas troika” among three of the largest natural gas producers – Iran, Russia and Qatar – would result in all members of the troika losing significant market share over time with only minor, short-lived gains from higher prices. The development of alternative supplies from a variety of other sources, including North America, would serve as counterweights to attempts by the troika to exercise any market power. “Ironically, Russia could be one of the biggest losers in this scenario,” Medlock said.
The Baker Institute recommends that the United States and Europe work together to promote the development of additional natural gas storage capacity (perhaps a strategic stockpile), particularly in Europe, to enhance energy security in the emerging global natural gas market.
The study also notes that concerns about the vulnerability of Eastern European countries such as Ukraine and Poland could be best addressed by helping to finance projects to diversify the natural gas supplies of those countries.
The Haynesville Shale and other natural gas reservoirs in the United States will enable America to provide not only natural gas to its citizen, but also assist in building up a natural gas storage; thus, a shale solution to any potential energy war.
Click here to view the executive summary of the study.
Short URL: http://naturalgasforamerica.com/?p=346
Posted by admin
on June 2nd, 2009. Filed under Shale Basins, Shale Gas.
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