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# Natural Gas From Shale Bursts Onto the Scene

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Science  25 Jun 2010:
Vol. 328, Issue 5986, pp. 1624-1626
DOI: 10.1126/science.328.5986.1624

New technologies have sparked a rush of drilling in the United States, but environmental concerns and economic unknowns could still keep shale gas from becoming a bridge to clean energy.

Engineering ingenuity is unlocking a vast storehouse of natural gas buried beneath American soil from Texas to New England. Drillers are turning their instruments from the vertical to horizontal and then blasting the rock that tightly holds the gas with high-pressure chemical brews. This “fracing” (pronounced and sometimes spelled “fracking”) is finally making gas trapped in shale a profitable resource. That change, in turn, has driven up declining U.S. gas production, rescuing the American natural gas industry from seemingly inevitable depletion.

The sudden great promise of clean, homegrown shale gas has all kinds of people excited. National-security types see it as a replacement for foreign oil and gas, environmentalists as a replacement for dirty coal and even oil. And because it yields only 45% of the carbon dioxide emissions of coal, advocates of taming global warming see it as a temporary crutch while carbon-free energy sources are developed and deployed. Everyone seems to agree with a March study by IHS Cambridge Energy Research Associates in Massachusetts that concluded that shale gas “provides the potential to transform North America's energy landscape.”

The problem is that word “potential.” Every link in the chain between the newly abundant domestic energy source and its transformative impact is still shrouded in uncertainty. How much gas is there? What will it cost to extract? What government policies will be needed to direct the natural gas revolution toward reducing greenhouse gas emissions? No one's sure. And a rising tide of NUMBY—not under my backyard—that's greeting shale gas in the Northeast could hobble the revolution (see sidebar, p. 1625).

## How to unleash the gas

The newly applied technology of shale gas extraction is letting drillers go straight to the source. Conventional deposits of oil and gas are actually the final resting places of far-traveled hydrocarbons that were generated in deeper “source beds” of organic-rich rock. Drill into a conventional reservoir, and out flows oil and gas.

By contrast, shale gas—a so-called unconventional resource—never left its birthplace. It's still in the source bed whose organic matter gave rise to the gas. Because the pores in the fine-grained shale are not well connected, the rock is too impermeable to let the gas go. Drill into it—as drillers occasionally did—and you get barely a fizzle.

But all that shale gas began to look more and more tantalizing as conventional U.S. natural gas resources dwindled. After drillers had sunk millions of wells into North America's conventional oil and gas reservoirs, U.S. natural gas production—which had soared for three-quarters of a century—peaked in the early 1970s and promptly went into decline. The easy gas was quickly becoming a thing of the past.

Conventional gas production will never recover, but the two basic tools drillers needed to unleash unconventional shale gas were already on hand, waiting to be combined and refined. From the offshore oil and gas industry, they borrowed horizontal drilling. The ability to drill straight down and then bend the hole made it possible to drain much more of a reservoir from a single offshore drilling platform. Onshore, horizontal drilling out to 2.5 kilometers from a drill site can multiply the length of a single well within a gas-bearing shale layer by five or 10 times.

The other tool was hydraulic fracturing, or fracing. Drillers pressurize a horizontal section of a well by rapidly pumping in 3 million or 4 million gallons of water (plus a bit of fine sand and chemicals) to pressures of up to 7000 kilopascal. The extreme pressure creates a football-shaped cloud of fractured shale 300 meters long, the fractures remaining propped open by sand grains. Repeat up to 30 times in one well and drill tens of wells from a single site, and you could free up enough gas to make a tidy profit.

## Hitting the mother lode

When the price of natural gas began to climb along with that of oil early in the decade, newly equipped shale gas drillers went to work. In 2000, shale gas was 1% of the U.S. gas supply; now it is 20%. Production from the Barnett Shale under Fort Worth, Texas, increased 3000% from 1998 to 2007. And unconventional gas—from shale, low-permeability sandstone, and coal beds—rose to more than 50% of U.S total production. By 2009, total production was back up almost to the 1970 peak, thanks largely to shale gas.

With gas gushing from the Barnett Shale and increasingly from other shale basins (see map), those sizing up America's natural gas resources took notice. Last June, the Potential Gas Committee, a nonprofit organization of experts, announced that shale gas was largely responsible for boosting PGC's estimate of the country's total available future supply of gas by 35% from its previous estimate just 2 years earlier. The natural gas resource had reached the highest level in the committee's 44-year history. That would be a 100-year supply at the current rate of consumption, industry ads touted.

The changes in the natural gas industry could be big. A June 2009 study by Navigant Consulting Inc. in Houston, Texas, found that gas production companies believed that they could be producing 300 billion cubic meters of shale gas a year—equal to half of today's total U.S. gas production—in little more than a decade. And thanks in large part to shale gas, “natural gas is more than a bridge fuel; [it] is part of the long-term energy solution,” James Mulva, chair and CEO of Conoco-Phillips, said at a major oil and gas gathering last March in Houston.

## Enter uncertainty

Despite all the glowing testimonials, every shale gas analysis has its caveats. The Navigant estimate of future production, for example, “represents what producers say they could do if everything works,” says Richard Smead, a Navigant analyst, but “there are so many issues.”

For one, experts question how much gas is actually in the ground and how much of that can be extracted. “The [shale gas] resource is quite large,” says analyst Richard Nehring of Nehring Associates in Colorado Springs, Colorado, “but how large is it?” Resource estimates are usually reported as an average, he notes, but that conceals the range of uncertainty. PGC's 100-year supply “could be 50 years to 125 years of supply at present rates,” he says. And production will peak and decline rather than hold steady for 50 years or 125 years and then suddenly disappear. Nehring recently estimated that U.S. and Canadian gas production will likely peak sometime between the 2020s and the 2040s, depending in large part on how much shale gas there is.

Narrowing the resource uncertainties will take a while. “At this stage of the game, we have very little experience with shale gas,” notes Nehring. “Predictions of well performance over 15 to 20 years are based on 6 to 24 months of experience.” Yet flow from a new well can decline by 60% to 80% during the first year of production alone. “We don't know if they'll keep diving or level off,” says geologist Richard Pollastro of the U.S. Geological Survey in Denver.

Future shale gas production will also depend on the profits to be made from extracting the gas. Production took off as the U.S. price of gas soared toward $14 per million British thermal units (MBtu). Since that peak, the price has fallen to about$4.50 per MBtu. Some shale gas producers might be making money from some wells at the current price, Navigant's Smead says, but “it's not sustainable; it's not good for growth.”

On the debit side of the ledger, the cost of producing shale gas could soar once drillers have depleted the obvious “sweet spots” where geology has made the gas particularly abundant and relatively easy to extract. For example, the Marcellus Shale now under development runs 1000 kilometers from eastern Kentucky halfway across New York state, but the difficulty and expense of getting gas out varies from location to location. Without further technological change, production could become considerably more costly in the future.

How much shale gas actually gets used in coming decades also depends on how it fits into the U.S. energy economy. To see how gas might perform as a “bridge” to a low-carbon energy future, resource economists Stephen Brown, Alan Krupnick, and Margaret Walls of Resources for the Future in Washington, D.C., ran a range of scenarios in the National Energy Modeling System, which was developed by the U.S. Department of Energy and modified by RFF.

The energy model predicted prices and consumption across U.S. energy markets under various assumptions about the size of U.S. shale gas resources and the nature of government energy policy, among other factors. The researchers used it to explore scenarios in which the shale gas resource was either moderately large or very large and in which the country either had or lacked a low-carbon cap-and-trade policy with carbon dioxide emission targets similar to those in legislation passed in the U.S. House of Representatives.

Simply having a shale gas bonanza, the modeling suggested, doesn't solve all energy problems. In the absence of a low-carbon policy, more abundant shale gas “just gives you cheap energy,” says Brown, and everyone “just consumes more”—although gas burns more cleanly than conventional fossil fuels do and is a domestic fuel rather than a foreign one. Some coal is displaced from the energy mix, but so are zero-emission nuclear energy and renewables. As a result, both energy consumption and carbon dioxide emissions increase slightly. With a low-carbon policy in place, however, things are different. In that case, the model showed, abundant shale gas fills the need for a low-carbon fuel, somewhat decreasing the cost of meeting emission goals in the law. Even if shale gas is less abundant, the low-carbon policy still helps nuclear energy and renewables to replace coal.

Shale gas “is a bridge if we want it to be,” Brown concludes. But given all the uncertainties, he says, putting a price on emitted carbon—using cap-and-trade or a carbon tax—is preferable to letting the government promote one technological solution over another. The government could easily guess wrong, he notes.

Ingenuity and perseverance have unleashed a natural gas revolution in America and someday perhaps worldwide. But the revolution's first test is already in the offing. Financial arrangements that have encouraged continued shale gas drilling despite low prices will begin to expire in the next year or so. Drillers are said to be slowing the frenetic pace of sinking wells that's required just to maintain production. And a blowout that struck a well in the Marcellus Shale earlier this month serves as a reminder that environmental concerns could still sway a jittery public to favor leaving the gas inside the rock.

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