Shale gas scepticism, and shale gas enthusiasm

All those upward revisions to natural gas reserves aren’t convincing everyone. Matt Simmons, author of Twilight in the Desert, is deeply sceptical. The Houston Chronicle reported a few quotes from him earlier this week:

Simmons simply doesn’t believe all the gas is there that many believe and that the process of getting at it – the water-intensive hydraulic fracturing method – is a huge waste of otherwise drinkable water. A report linking contaminated drinking water to the process could be troubling for the procedure, he says.

The ProPublica report linked to above says the Environmental Protection Agency found chemicals used in hydraulic fracturing in three water wells in Wyoming. More testing will be carried out over the next few months to try to determine exactly where those chemicals came from.

But as for Simmons’ other criticisms, he expanded on these views in a much longer interview with ASPO back in April:

I’ve never seen the industry hype something crazier.  Here are some numbers that I find enlightening.  Of all the shale plays, the only one that we have significant production history on is the Barnett Shale.  In the Haynesville, I think there are around 20 or 30 well-tests so far, and I don’t know that there are that many in the Marcellus.  Consider these figures in the March 22 Barnett Shale Newsletter.  It shows Barnett Shale total natural gas production by year, 1982 to 2008, all counties and fields in the Fort Worth Basin.  In 2004-3890, then 4973, then 6542, then 9180, then finally 12104; and I thought, gee, we increased production X%, but then I realized that’s the number of wells!  In 2008, we went to 4.8 Bcf a day, from 3.56 the year before-or up 1.24 Bcf/day.  We’re looking for an increase of 8 Bcf, according to the EIA numbers, so the Barnett Shale did 1/6th of that.

Simmons also talks about the EIA figures and says that with Barnett Shale, peak initial production “happens virtually when you come onstream”.

Meanwhile Stephen Holditch, head of the petroleum engineering department at Texas A&M University, told a conference that he believes there could be nine times as much technically recoverable gas in the US as is conventionally recoverable. This would equate to 32,560TCF in the US, he said, and that this 9x rule might apply to the rest of the world’s gas reserves, too. (H/T No Hot Air)

Related links:

International energy companies plan for global shale play (FT Energy Source, 24/08/09)
Natural gas bulls (FT Energy Source, 21/08/09)
Natural gas to build up its lobbying (FT Energy Source, 23/07/09)

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