Here’s what’s happening in the world of shale oil and gas drilling:
The Barnett Shale may not live up to its vast production expectations. A forthcoming report from the Bureau of Economic Geology at the University of Texas at Austin says that well results in the country’s original shale field might not be as high as the industry initially thought.
Jim Fuquay writes, ” There are literally hundreds of billions of dollars on the line, from wells drilled and pipelines laid to processing plants built. Tens of billions more are being committed by chemical manufacturers to take advantage of cheap U.S. gas supplies.
Rising production in the Barnett Shale and the Eagle Ford Shale field in South Texas, which produces oil and gas, has given the state’s economy a leg up, leading Texas Comptroller Susan Combs in her most recent budget outlook to call shale production in Texas and elsewhere “an extraordinarily important economic driver.”
(Here’s the story from the Fort Worth Star-Telegram).
In Australia, officials in Queensland have given the go-ahead to shale oil drilling.
The Wall Street Journal reports, “Amid the buzz around Australia’s vast offshore gas fields and unconventional resources such as coal seam gas and shale gas, the country’s potential to grow its oil output has been largely overlooked.”
“But international oil companies have been planting flags in parts of central Australia where the geology is similar to the Eagle Ford and Horn River regions of the U.S., which have become major production areas for tight oil.”
Kuwait is starting to study its shale gas reserves, with a report expected by the end of the year. (Dow Jones story here).
Ohio is considering a state law that would require oil and gas drillers to test drilling mud and crushed rock for radioactive material before taking it to a landfill. (Story from the Columbus Dispatch).
How much does uber-cheap natural gas affect utility decisions? A lot. A story from the Fort Wayne Journal Gazette looks at Duke Energy’s decision to dismantle a Florida nuclear plant rather than repairing it. (And of course the price of natural gas – which can’t be easily exported – plummeted a few years ago when shale gas drilling boomed across the country).
“We view gas as the most viable short-term option,” said Mike Hughes, a Duke spokesman. “The costs are low and we anticipate the cost of fuel for the foreseeable future will remain relatively low. Long term, we don’t think you should put all of your eggs in the gas basket.”