In a relatively short period of time—less than five years—technological breakthroughs have unlocked massive quantities of natural gas in shale deposits that were previously thought to be unprofitable. The International Energy Agency's latest estimate of global natural gas resources is more than double the estimate it put forward in 2008. And much of that gas is in the United States.
For decades, drillers were unable to extract profitable quantities of natural gas from low-permeability shale, coal beds, and tights sands deposits. In recent years, however, drillers have perfected two techniques that have long histories in the oil and gas industry: horizontal drilling and hydraulic fracturing. The combination of these techniques ushered in what is known as the "shale gas revolution." The results of that revolution are only now coming into focus.
This paper provides ten reasons why natural gas continues to gain market share and why it will be a key fuel of the future.
- Natural gas saves consumers money.
- If it's not going to be nuclear, it's got to be gas.
- Natural gas is abundant and the globalization of the gas market is accelerating.
- Unconventional gas is driving unconventional oil production
- Unconventional oil production is stimulating the U.S. petrochemical sector and global oil production.
- The United States's huge gas production capability, and its vast gas infrastructure, make it uniquely well positioned to take advantage of the shift to natural gas.
- Increasing regulatory pressure on the coal sector is leading electricity generators to switch to natural gas.
- Low-cost natural gas means lower-cost electricity.
- Two key trends—decarbonization and urbanization—favor increased use of natural gas.
- Global electricity demand is growing rapidly.