I might have been the only person in a rather large room, during the IAEE international conference in Rome who understood that OPEC was tired of playing games with its customers, and had launched the strategy that started the oil price to its 2008 crest of $147 per barrel.
That price was quite enough to help push the global macroeconomy into a partial meltdown, from which it has yet to recover.
Now we are being told that shale gas will not only rock our world , but change our game . I certainly hope this is true, although I suspect that many of the promoters of shale gas have adopted some propaganda tricks similar to those employed by the crooks from whom I once purchased my electricity, and who apparently are still be able to convince a portion of their drowsy clientele that the truth is anything that does not sound like a lie.
Among other things, we are constantly being told that thanks to the current and potential exploitation of a revolutionary new technology on this very old resource, shale natural gas, the U.S. possesses a hundred year supply of natural gas at present consumption rates.
As far as I am concerned, the way to deal with this claim is to ignore it, because demonstrating that it is probably complete nonsense only requires some mathematics that Dr Strangelove would have described as simple , and even within the scope of university students like Ferdinand E. Banks just before he was pronounced as hopeless by the Dean of Engineering at Illinois Institute of Technology (Chicago, Illinois), and summarily expelled from that excellent seat of higher learning.
In any event, I believe that the same kind of mathematics is appropriate here as employed in the chapters on oil in my energy economics textbooks (2000, 2007). For example, one hundred years of oil as calculated from the present reserve-production ratio actually becomes something quite smaller when such nuisances as profit maximization are taken into consideration. This is because of the cost increases required to raise or maintain output as deposits are depleted.
A few days ago I attended a large meeting on natural gas at the Stockholm School of Economics. I thought that the emphasis would be on shale gas, but that was only a digression.
As to be expected, though perhaps not appreciated, when the Q & A began, I attempted to set everybody straight on the past, present and future of shale gas, supplying both answers as well as questions, but I am afraid that my efforts were not accorded the admiration they deserved by the sponsors of the meeting.
Two young ladies from Finland however gave a very useful presentation of shale gas, and among other things provided an interesting prediction of the percent of shale gas expected in U.S. consumption (or production) in 2035.
An interesting prediction for yours truly that is, because as one of my students at the Asian Institute of Technology (Bangkok) insisted in 2007, the peaking of conventional natural gas output could take place in the US in the not too distant future.
Now we see where the mathematics mentioned above comes into the picture. Shale gas will have to compensate for a likely fall or leveling off of the production of conventional natural gas in the U.S., as well as the natural decline (assuming that this is as relevant for gas deposits as it is for oil), and in addition help to provide the expected increase in consumption an increase that will be boosted by what might turn out to be incorrect predictions of the future price of gas due to the conjectured domestic availability of shale gas resources.
Using the numbers provided for the share of shale gas in the U.S. output by the two researchers from Finland, as well as a few other things, I see no reason to talk about shale gas rocking anything before the global economy resumes its normal rate of growth, and we can get some idea of the future consumption of natural gas and other energy resources.
Increasingly I have long conversation with myself on the subject of shale gas, and accept that shale as with June in a famous American song could be busting out all over . I see no signs of this as yet, but admittedly, getting a definitive answer to this puzzle will have to wait for a few years.
That price was quite enough to help push the global macroeconomy into a partial meltdown, from which it has yet to recover.
Now we are being told that shale gas will not only rock our world , but change our game . I certainly hope this is true, although I suspect that many of the promoters of shale gas have adopted some propaganda tricks similar to those employed by the crooks from whom I once purchased my electricity, and who apparently are still be able to convince a portion of their drowsy clientele that the truth is anything that does not sound like a lie.
Among other things, we are constantly being told that thanks to the current and potential exploitation of a revolutionary new technology on this very old resource, shale natural gas, the U.S. possesses a hundred year supply of natural gas at present consumption rates.
As far as I am concerned, the way to deal with this claim is to ignore it, because demonstrating that it is probably complete nonsense only requires some mathematics that Dr Strangelove would have described as simple , and even within the scope of university students like Ferdinand E. Banks just before he was pronounced as hopeless by the Dean of Engineering at Illinois Institute of Technology (Chicago, Illinois), and summarily expelled from that excellent seat of higher learning.
In any event, I believe that the same kind of mathematics is appropriate here as employed in the chapters on oil in my energy economics textbooks (2000, 2007). For example, one hundred years of oil as calculated from the present reserve-production ratio actually becomes something quite smaller when such nuisances as profit maximization are taken into consideration. This is because of the cost increases required to raise or maintain output as deposits are depleted.
A few days ago I attended a large meeting on natural gas at the Stockholm School of Economics. I thought that the emphasis would be on shale gas, but that was only a digression.
As to be expected, though perhaps not appreciated, when the Q & A began, I attempted to set everybody straight on the past, present and future of shale gas, supplying both answers as well as questions, but I am afraid that my efforts were not accorded the admiration they deserved by the sponsors of the meeting.
Two young ladies from Finland however gave a very useful presentation of shale gas, and among other things provided an interesting prediction of the percent of shale gas expected in U.S. consumption (or production) in 2035.
An interesting prediction for yours truly that is, because as one of my students at the Asian Institute of Technology (Bangkok) insisted in 2007, the peaking of conventional natural gas output could take place in the US in the not too distant future.
Now we see where the mathematics mentioned above comes into the picture. Shale gas will have to compensate for a likely fall or leveling off of the production of conventional natural gas in the U.S., as well as the natural decline (assuming that this is as relevant for gas deposits as it is for oil), and in addition help to provide the expected increase in consumption an increase that will be boosted by what might turn out to be incorrect predictions of the future price of gas due to the conjectured domestic availability of shale gas resources.
Using the numbers provided for the share of shale gas in the U.S. output by the two researchers from Finland, as well as a few other things, I see no reason to talk about shale gas rocking anything before the global economy resumes its normal rate of growth, and we can get some idea of the future consumption of natural gas and other energy resources.
Increasingly I have long conversation with myself on the subject of shale gas, and accept that shale as with June in a famous American song could be busting out all over . I see no signs of this as yet, but admittedly, getting a definitive answer to this puzzle will have to wait for a few years.
