Monday, March 17, 2014
It has been 10 years since there were more conventional than unconventional wells being drilled annually in the U.S., but hydraulic fracturing has yet to make an impact elsewhere in the world, where operators continue to face environmental worries and logistical challenges, say analysts with the research and consulting firm GlobalData.
According to Matthew Ingham, GlobalData’s lead analyst covering North Sea and Western Europeupstream, and Gustavo Bianchotti, senior analyst for Europe, Middle East, and North African upstream, countries must consider the significant impact that increasing supplies of unconventional gas have had in the U.S., where natural gas prices stand at less than half of those in Europe.
“Russian gas exports to Europe grew to a record of 15.6 billion cubic feet per day last year,” said Ingham. “While domestic production from countries such as France, Poland, Lithuania, and Ukraine cannot fully replace this supply, it can reduce expensive, long-term Russian contracts and cushion volatile North African supplies, creating a more favorable price environment for the general public.”
In November 2013, Chevron signed a $10-billion shale gas production sharing agreement with Ukraine’s government to develop the western Olesska field, followed by a similar shale gas agreement with Shell. Although political, exploratory, and commercial risks remain in Ukraine, Lithuania, and Poland, analysts say shale production is inching closer. However, hydraulic fracturing continues to lack public approval.
Public disclosure of fracking constituents in the U.S. has done little to bring peace of mind, and “fracktivists” from 26 countries are currently scheduling worldwide protests. “Mitigation programs will be vital to the successful development of a well-rounded shale gas program and will facilitate acceptance of shale gas exploration and development in Europe,” said Bianchotti.
According to Matthew Ingham, GlobalData’s lead analyst covering North Sea and Western Europeupstream, and Gustavo Bianchotti, senior analyst for Europe, Middle East, and North African upstream, countries must consider the significant impact that increasing supplies of unconventional gas have had in the U.S., where natural gas prices stand at less than half of those in Europe.
“Russian gas exports to Europe grew to a record of 15.6 billion cubic feet per day last year,” said Ingham. “While domestic production from countries such as France, Poland, Lithuania, and Ukraine cannot fully replace this supply, it can reduce expensive, long-term Russian contracts and cushion volatile North African supplies, creating a more favorable price environment for the general public.”
In November 2013, Chevron signed a $10-billion shale gas production sharing agreement with Ukraine’s government to develop the western Olesska field, followed by a similar shale gas agreement with Shell. Although political, exploratory, and commercial risks remain in Ukraine, Lithuania, and Poland, analysts say shale production is inching closer. However, hydraulic fracturing continues to lack public approval.
Public disclosure of fracking constituents in the U.S. has done little to bring peace of mind, and “fracktivists” from 26 countries are currently scheduling worldwide protests. “Mitigation programs will be vital to the successful development of a well-rounded shale gas program and will facilitate acceptance of shale gas exploration and development in Europe,” said Bianchotti.
