Shale gas growth 'may hit regional LNG market'
Dubai, December 6, 2010
Investment in the development of shale gas, a natural gas recovered through a careful procedure involving horizontal drilling and hydraulic fracturing in the US and Europe could hit Middle East gas markets, said an expert.
“Over the last several years, technologies for extracting unconventional natural gas from shale formations have been implemented with greater precisions resulting in lower costs,” said Colin Chapman, president of Euro-Petroleum Consultants’ (EPC), a leading independent consultancy for downstream oil, gas and petrochemicals industries.
“So much so that costs for these types of gas projects have been in some cases lower than those of more conventional projects,” Chapman pointed out in the EPC analysis of the growing role of shale gas production in Europe, North America and Asia.
Offering fresh insights into the future of global gas market, Chapman said, 'In Europe, shale and other unconventional gas resources have been identified in France, Germany, Hungary, Italy, Netherlands, Poland, Romania, Spain, Sweden, Switzerland and the United Kingdom.'
'As a result, LNG-rich nations such as Qatar and UAE have already begun re-evaluating options of exporting gas to some of its gas-strapped neighbouring countries,' the expert stated.
Chapman was speaking ahead of EPC’s 'ME-TECH 2011 Conference & Exhibition' to be held from January 24 to 26 at the Madinat Jumeirah in Dubai.
The conference aims to discuss latest technology developments in the downstream industry, including gas processing, oil refining, residue upgrading and petrochemicals.
'Several high profile industry representatives such as Ibrahim Al-Ansari, general manager, Dolphin Energy and Dr Abdulwahab Al-Sadoun, secretary general, Gulf Petrochemicals and Chemicals Association, will be there to discuss global and regional trends,' he added.
On the present scenario, Chapman said, 'Looking at the regional LNG market, the fact we are currently in the middle of a global economic downturn coupled with the emergence of the unconventional gas supply and new LNG capacity coming on-stream, it is likely that there will be a reduction in project activity in the LNG sector over the coming year.'
North America has been the leader in developing and producing shale gas and the great economic success of the Barnett Shale field in Texas has spurred the search for other sources of shale gas across both the US and Canada.
Within the Middle East region, shale reserves exist in Jordan and Syria, but the extent to which the deposits will have on the overall gas balance will largely depend on the speed at which exploration efforts advance, the expert revealed.
The processing of Shale gas has turned around the decline of US gas reserves and significantly changed the gas supply outlook for the US.
According to recent reports, estimated US reserves of natural gas were 35 per cent higher than those estimated only two years ago, he added.-TradeArabia News Service