Shale Gas Criticisms Rebutted

From the July 4, 2011, issue of Fleets & Fuels, the publication of Fleets & Fuels: Biweekly Business Intelligence for Clean Transportation Professionals:

This Ain’t No Ponzi

Shale Gas Boosters Fire Back at New York Times After Articles Say Claims for Methane Overblown

The New York Times raised the ire of shale gas advocates as investigative pieces citing named and many unnamed sources, questioned the potential of shale gas as a large-scale contributor to a cleaner and more secure American energy mix.

An article by Ian Urbina cited e-mails and other documents indicating that in addition to environmental impacts, shale gas wells are not producing as has been hoped. Urbina reported that well informed, senior people have likened shale gas to a Ponzi scheme.

In a subsequent article, Urbina wrote, “One official says the shale industry may be ‘set up for failure.’ ‘It is quite likely that many of these companies will go bankrupt,’ a senior adviser to the Energy Information Administration administrator predicts. Several officials echo concerns raised during previous bubbles, in housing and in technology stocks, for example, that ended in a bust.” The articles concede that shale gas technology has evolved considerably since some of the doubts were expressed.

They prompted strong reaction.

“This particular NYT reporter has apparently sought out a few of the doubters to fashion together a negative view of the U.S. natural gas industry,” Aubrey McClendon, founder and CEO of Chesapeake Energy, says on a company Facebook page.

“This reporter’s claim of impending scarcity of natural gas supply contradicts the facts and the scientific extrapolation of those facts by the most sophisticated reservoir engineers and geoscientists in the world,”McClendon said. “It is also ludicrous to allege that shale gas wells are underperforming as we sit awash in natural gas, with natural gas prices less than half of what they averaged in 2008... CHK and other shale gas producers are routinely beating our production forecasts...

“This reality of generations’ worth of natural gas abundance is also supported by virtually every credible third-party expert.”

“The U.S. natural gas supply growth revolution,” McClendon said, “is changing the future of our nation for the better in multiple areas.”