A reason given by the UK Green Party for slowing down shale gas is their view that we don't know enough about it and Europe is lacking in a regulatory regime.
Strangely enough this reasoning isn't that far off from analysis from the likes of Deutsche Bank and Sanford Bernstein that European shale is a long way off because the "regulatory regime" whatever that means, isn't there.
Yesterday we saw the EU come out with very encouraging news that as far as they are concerned, they are happy with the current regulations, especially during the exploration period we're in now.
This was a battle of two narratives.The right sees the EU and regulation as inherently obstructive, while the Greens dream of using their influence in Brussels to block shale. So yesterday was a surprise for the conventional wisdom of both sides, although certainly not for anyone who has heard the public and private comments of EU officials over the past six months.
In yet another sign in a positive week, the International Energy Agency, which represents the energy side of the OECD and the G20 said something very similar yesterday in Davos:
The International Energy Agency (IEA) will recommend the G20 consider imposing stringent rules on the development of unconventional gas to address ecological concerns and allow the world to have real benefits from the shale gas revolution.
The IEA's Chief Economist Fatih Birol told Reuters in Davos on Friday that it plans to publish "golden rules for the golden age of gas" in May in which the agency will give regulatory recommendations for shale gas, and that it will hold a meeting on unconventional gas in Poland on March 7, inviting players from Russia, Australia, South Africa, Mexico, and other major gas producers.
"We will have a series of recommendations for governments, companies and regulators," Birol said.
Later on in the story however a contradiction. Energy Commissioner Oettinger announced he was happy with regulation, but the Green's friends lost the message in transit to Davos:
Connie Hedegaard, European Commissioner for Climate Action, told Reuters the European commission was already looking into what kind of regulation could be implemented across the bloc.
"A global way of doing that, that sounds great, but it's probably not something you could do very quickly ," she said.
"What we're doing is before it gets to be a very big issue we are trying to see about the chemicals, about the fracking, about the consequences. That need s analysis , " she told Reuters .
"We would never mind hav ing international legislation around this, but as that will probably take some time, it's just important for us to check whether our own legislation is adequate , " she added
Sounds like some in Europe are still betting on a slow down period. But even Fatih Birol himself sounded two sided. First:
Birol said that unconventional gas had the potential to change the global energy supply structure.
"The way nuclear energy changed the picture 40 years ago, we may see similar changes in the energy picture globally and in some countries due to unconventional gas ... It will have massive economic and geopolitical implications," he said.
I like that analogy with nuclear and how it will have massive implications. But how can something have massive implications and explain the next sentences?:
Despite this global potential, Birol said that it was unlikely that shale gas production would kick off in Europe in the near future.
"There is a lot of activity underway in Poland, however, I would be very surprised if in the next few years we see a substantial amount of
Another contradiction is that the conference on this revolution that won't happen will take place in the country where it is allegedly not happening either! They could have this shale meeting in Houston instead in that case. Or Shanghai. Europe is the largest gas market on earth. It has a regulatory regime and rule of law second to none. If Europe does not have shale energy, then the global impact of shale will be minimal .To pretend that Europe is different, is to exaggerate the problems, or as Bernstein and the Greens wish, to simply create them out of nothing.