The end of expensive energy


Perhaps it was because there weren’t many other people to speak to at the MEDACT report on fracking launch in London, but various antis and pro’s, or me at at least, had some civilised and hopefully eventually productive, conversations.

Only 24 showed up in the audience, four of them US antis so we can discount them to some extent in the UK/EU debate. There were four pro shale siders, including Michael Roberts the Reverend Geologist from Lancashire. Keeping discreetly quiet were at least four other shale PR types familiar from the conference circuit. It rather proves my recent analysis that in the world of shale opposition, it’s not August 2013 anymore.That was further demonstrated by the taciturn reception the report received in the press.  MEDACT did manage to get the somewhat derivative and outdated study reported by a freelancer in the Guardian, which will no doubt ripple out among the faithful, but everyone else, maybe even antis themselves judging by recent non-events, seems to be getting bored. The coming election will be exciting, but as I’ll point out another time, is unlikely to change anything about UK shale.

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4C: climate, coal, China and change

jonathanstanfordThese are truly wondrous times for the climate and the world gas industry. We’re seeing fundamental shifts in the entire energy field as coal is dying before our eyes. That is if we choose to look, something natural gas opponents in Europe are still much in denial about.

Dieter Helm says we don’t have a 2C temperature change problem, we have a 5C issue. Climate Change via Carbon from Coal in China. We are replacing coal in China with the same prescription that works in the United States: efficiency, renewables and low cost natural gas. Some will choose to ignore the role of gas at the same time they celebrate the “victory” of renewables.  Others will pretend we have to choose from a menu, instead of the prescription. It’s much like a course of penicillin: failure to take the whole medicine may make you feel good immediately but won’t prevent a recurrence of future problems. Like anything else in nature, cross pollination of different energy sources will combine to provide innovative solutions.  Efficiency and renewables alone won’t cure the outdated sickness we bring upon ourselves by continuing coal use.

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The new Climate Deniers are Natural Gas Deniers.

i can do itThis November in Paris, the WPCC 2015 World Climate Conference will be held. Given the amount of countries involved, there have already been various meetings ahead of it, and it’s clear that the two greatest emitter of carbon are out to solve the issue via a variety of ways, but the original road starts with abundant natural gas knocking coal out of the picture.  

If one listens to the Green Parties and Guardians of the world, this is the last chance to save the planet, a narrative that dates from all the other failed conferences over the years. It’s worth a quick look back to the previous summit in  Copenhagen as reported in No Hot Air in 2009. Since then there have been smaller conferences about conferences which didn’t achieve anything either, apart from Greenpeace vandalising the Nazca Lines last year. To the natural gas industry, the solution in 2009 had already fallen out of the sky as Tim Wirth noted, but this was a case of too soon. Aubrey McClendon, then of Chesapeake noted that European gas regulators had no idea of what he was talking about.

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Oil linked gas makes coal to gas switch viable in Asia

Disruption 02Too often lost in the fracking debate is how natural gas abundance is spreading worldwide even as shale gas remains mostly contained in North America. 

Only ten years ago, the US was expected to import natural gas in the form of LNG and pay for the privilege. The perception led to the development of LNG resources worldwide that would sell into either the US market, or into traditional LNG importers like Japan or emerging ones like China and India, who would be expected to pay prices based on gas as premium fuel.

But premium gas was the flip side of peak oil. High oil prices led in many markets to high gas prices, especially in Europe and East Asia. Contracts for LNG, as with Russian gas, were linked to oil. When oil rose due to a perception that it was becoming scarce, natural gas went up too – even as huge volumes became available. This meant that old gas, linked to oil was expensive. New gas, linked to shale in the US and then to extra capacity in LNG reflected spot prices of supply and demand.

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Second, and more, opinions on fracking and health.

quack-doctor-788714-e1419140773623Perhaps it’s because I’ve had much experience with doctors sticking needles into me lately, I’m starting to think about how germane it is for doctors to stick their oars into the shale debate.

I’m an especially phlegmatic and uncomplaining patient. My experience being married to a nurse and my several years experience around buying gas and power for the NHS means that I trust a doctor even more than most people. Given a youthful history of smoking, drinking and going out every night for twenty years, I’m in great shape, rarely having even a sneeze but making up for it by getting spectacularly ill every ten years of so since my twenties. I’m here today, having gone through far worse, because I listen to doctors, at least most of the time.

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The Storm before the Calm: UK shale opponents evaporate

irrelevantI’ve been using a variation of this line since 2008: “I’ve been in the natural gas business for 24 years and the first 17 were really boring”. But I think it’s going to get boring again and we can all worry about important stuff again.

We’ve had the storm, now it’s time for the calm in UK onshore oil and gas. Note how I include oil and don’t differentiate between shale and “conventional”. We may be entering a phase where the industry will be allowed to just do it. 

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