Articles from 2012
Daniel Yergin on China Shale Gas
- Published Date
- Written by Nick Grealy
Put together Daniel Yergin, China and Shale Gas and you have a story that every energy economist anywhere should listen to
Daniel Yergin, energy analyst and Pulitzer Prize-winning author, told Bloomberg's Tom Keene yesterday that the Chinese are obsessing over the shale hydrocarbon revolution that's spread across the U.S.
But not necessarily for the reason you think.
As it turns out, as lofty as estimates of America's shale reserves have been, they remain one notch behind China's
Now here I have to introduce something from The Guardian, Greenpeace and Friends of the Earth's favourite German bank. Remember one negative report by DB last year has been repeated at length, despite the author of the report telling me that he was actually quite optimistic about European shale. Here was The Guardian for example
That's a bucket of cold water to cool the ardour of shale gas fans, but why did Deutsche Bank reach this conclusion? They won't put the report online, so I'll give you their reasons in their words.
Prime among the uncertainties are the size of the recoverable resource, the rate at which production can be achieved, and the extent to which the concerns of local residents and environmental groups can be accommodated.
That rings true. As I have written before, Cuadrilla's titanic estimate of the available gas in their patch in the UK is most charitably described as heroic. And the protests have got off to an early and loud start.
One can now, as noted earlier this week, charitably admit that Cuadrilla's Titanic estimates were wrong: They were too conservative. Back to DB and I wonder how Friends of the Earth propose to ignore this:
European Greens are really starting to appear ridiculous as organisations that owe their very existence to a global argument on CO2 reduction can now come up with no stronger arguments against shale than it would breach UK climate targets. UK Climate targets are of course only in place because of the assumption that by 2050 the entire planet would be poisoned by Chinese coal.
I'm sure that Damian Carrington and Greenpeace insist that China won't replace coal any sooner than Europe will have major resources. But what of the opinion of one of the worlds most famous energy experts? Back to Dan Yergin:
I was struck by how interested they are and how carefully they're following what's happening in U.S. shale gas. First becuase they see it has enhancing the U.S.'s division of the global economy. And second, the question they're asking themselves: if their resources are geologically larger than the United States, how long it will take them to develop shale gas. And the number I kept hearing: five to ten years.
And the number I keep hearing is that yes they will develop that by five to ten years but the key numbers are in the late twenties and early thirties, when some talk of 500 Billion Cubic Metres of China shale gas. Which will be replacing Chinese coal, which means solving the climate crisis which should be a cause for rejoicing among Greens: Everything they ever dreamt of in CO2 reduction is possible and achievable. Why the long face? Or are they more concerned about the empty purse?