Study: The natural gas boom isn’t going anywhere for awhile

posted at 5:01 pm on February 28, 2013 by Erika Johnsen

While naysayers have been claiming that the natural-gas revolution is more of a flash in the pan riddled with problems than an economic boon built to last, a comprehensive new study from the University of Texas concludes that the rate of natural gas production is only going to keep increasing for decades to come before it eventually plateaus out. The WSJ reports:

U.S. natural-gas production will accelerate over the next three decades, new research indicates, providing the strongest evidence yet that the energy boom remaking America will last for a generation.

The most exhaustive study to date of a key natural-gas field in Texas, combined with related research under way elsewhere, shows that U.S. shale-rock formations will provide a growing source of moderately priced natural gas through 2040, and decline only slowly after that. …

The study, funded by the nonpartisan Alfred P. Sloan Foundation and performed by the University of Texas, examined 15,000 wells drilled in the Barnett Shale formation in northern Texas, mostly over the past decade. …

Looking at data from actual wells rather than relying on estimates and extrapolations, the study broadly confirms conclusions by the energy industry and the U.S. government, which in December forecast rising gas production.

“We are looking at multi, multi decades of growth,” said Scott Tinker, director of the Bureau of Economic Geology at the university and a leader of the study.

That means productive, private-sector job creation, enhanced energy security, economic growth, and more revenue, if the Obama administration has the good sense to allow the natural-gas boom to proceed unhampered. I’m thinking that President Obama’s rumored Moniz pick to replace Chu at the Energy Department is probably pretty indicative of how they’re going to play this thing — they’ll cautiously, modestly facilitate more natural gas development, but as a relatively cleaner “bridge fuel” while they heavily and heartily “invest” in and trumpet their efforts to buoy up their favorite perceived renewable energies, mandate more efficiency standards, and continue to hate on coal.

That sounds like the strategy to which an Obama adviser hinted on Wednesday: “We’re not glossing over the challenges of natural gas development, but we’re also not ignoring the opportunity natural gas presents for jobs and for the climate.” Via Reuters:

As U.S. oil and natural gas production booms, the Obama administration’s energy policy has been “fluid” by necessity to adapt to the huge economic opportunities and climate challenges posed by growth, the top White House energy and climate adviser said on Wednesday.

In a speech to a room packed with energy analysts and lobbyists, Obama adviser Heather Zichal acknowledged that U.S. energy policy “might not look perfectly pretty from the outside” as it evolves to shifting supply-and-demand scenarios.

“It is a little bit fluid, but the landscape is changing,” Zichal said at the Center for Strategic and International Studies, a Washington think-tank. …

The White House recognizes the impact oil and natural gas production has had on the economy, creating jobs and bringing manufacturing operations from companies like Dow Chemical Co and Ford Motor Co back from overseas, Zichal said.


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Just give bho/epa time and they will put a stop to this ‘boom’! Can’t have anything but bho approved energy going on here in the US now can we?
L

letget on February 28, 2013 at 5:07 PM

Eh, the progressives will continue to fight it tooth and nail. But they love science, innovation, and progress or something.

JeremiahJohnson on February 28, 2013 at 5:09 PM

If you look at the USGS surveys for natural gas and consider directional drilling technology is in its infancy they have no idea how much or how long Natural Gas production will go on. Anything at this point is a guess.

CW20 on February 28, 2013 at 5:09 PM

Well DUH. When businesses can’t hire even min-wage monkeys, where the **** are you supposed to find people to support big ventures?

MelonCollie on February 28, 2013 at 5:12 PM

It would help if we could cut off the flow of taxpayer dollars to the Sierra Club, World Wildlife Fund, Natural Resources Defense Council, and the dozens of other eco-Marxist orgs funded partly by grants from the EPA, Dept. of Interior, and other bureaucracies in DC.

Charlemagne on February 28, 2013 at 5:14 PM

Anything at this point is a guess.

CW20

Looking at data from actual wells rather than relying on estimates and extrapolations, the study broadly confirms conclusions by the energy industry and the U.S. government, which in December forecast rising gas production.

?

Knott Buyinit on February 28, 2013 at 5:16 PM

Which makes Obama’s “green energy” fiasco all the more foolish and quixotic.

AcidReflux on February 28, 2013 at 5:17 PM

Off topic, But interesting, if true:

Governor of Michigan to take over Detroit

LegendHasIt on February 28, 2013 at 5:20 PM

Study: The natural gas boom isn’t going anywhere for awhile

Hmmm, let’s see what Obama and the EPA have to say about that shall we…

SWalker on February 28, 2013 at 5:24 PM

Study: The natural gas boom isn’t going anywhere for awhile

…wonder why?

KOOLAID2 on February 28, 2013 at 5:26 PM

?

Knott Buyinit on February 28, 2013 at 5:16 PM

Yes. Any speculation while educated is simply a guess. In the 70′s the president of the largest oil company in the world speculated that we were imminently running out of oil. Vice presidents and district managers were quitting to become dealers because the inside information which proved to be bogus. Arco is the only company who called it and said we are not running out and low balled everybody.

100 years. Check the USGS numbers for reserves and consumption. Not even a start.

CW20 on February 28, 2013 at 5:35 PM

Knott Buyinit on February 28, 2013 at 5:16 PM

Yes. Any speculation while educated is simply a guess. In the 70′s the president of the largest oil company in the world speculated that we were imminently running out of oil. Vice presidents and district managers were quitting to become dealers because the inside information which proved to be bogus. Arco is the only company who called it and said we are not running out and low balled everybody.

100 years. Check the USGS numbers for reserves and consumption. Not even a start.

CW20 on February 28, 2013 at 5:35 PM

That was all about running the price of crude oil up. How much are you paying for a gallon of gasoline today?4 times what you were in 1970, 5 times maybe?

SWalker on February 28, 2013 at 5:39 PM

Is this like the Coal crisis?

Bmore on February 28, 2013 at 5:46 PM

How much are you paying for a gallon of gasoline today?

twice as much as Nov 2008

DanMan on February 28, 2013 at 5:46 PM

Republican groups readies pro-immigration-reform ad blitz

No llegal in this headline or any headline anymore. TH,HA,FOX… are insulting the intelligence of everyone who consumes thier propaganda. You are all boxheads if you don’t feel patronized when they say they are pushing “immigration reform”.

It’s the illegal subset of immigrants that they are referring to. These headlines and jenifer rubin and marco rubio insult you every time they call it “immigration reform”. If you don’t get this then you are the LIV, you are slow and you like being insulted.

BoxHead1 on February 28, 2013 at 5:48 PM

their

BoxHead1 on February 28, 2013 at 5:49 PM

Off topic, But interesting, if true:

Governor of Michigan to take over Detroit

LegendHasIt on February 28, 2013 at 5:20 PM

Can’t he just pay the Chinese a few million to annex it?

VorDaj on February 28, 2013 at 5:51 PM

Republican groups readies pro-immigration-reform ad blitz

No llegal in this headline or any headline anymore. TH,HA,FOX… are insulting the intelligence of everyone who consumes thier propaganda. You are all boxheads if you don’t feel patronized when they say they are pushing “immigration reform”.

It’s the illegal subset of immigrants that they are referring to. These headlines and jenifer rubin and marco rubio insult you every time they call it “immigration reform”. If you don’t get this then you are the LIV, you are slow and you like being insulted.

BoxHead1 on February 28, 2013 at 5:48 PM

Believe me, some of us do indeed get it, and we not not just offended, we’re pissed the phuck off.

SWalker on February 28, 2013 at 5:52 PM

That was all about running the price of crude oil up. How much are you paying for a gallon of gasoline today?4 times what you were in 1970, 5 times maybe?

SWalker on February 28, 2013 at 5:39 PM

Try 50cents. No it wasn’t. They really thought they were running out of crude. They felt when Alaska ran out that may be it and that is where Arco’s main supply came from. Arco said you’re nuts. They admittedly went after Arco in Seattle and got buried. Bottomless pit as they put it.

So you are correct they did go for the max price for their product. You would too if you thought your supply was limited. My point is however that the best in the business got it very wrong.

CW20 on February 28, 2013 at 5:53 PM

I keep posting to the wrong thread :(

BoxHead1 on February 28, 2013 at 5:54 PM

The Dems will destroy it all. Seriously. Give them the time, it will come to a halt.
Who is going to stop them? Certainly not Boehner or Cantor.

I think it was Lenin who said something like when it’s time to hang the last of the capitalists, it’ll be a capitalist who will sell him the rope.
Well, you can change that to.. “When it’s time to pound the last nail into the coffin of America, it’ll be the Republican House leadership that will do it.”

JellyToast on February 28, 2013 at 5:54 PM

SWalker on February 28, 2013 at 5:39 PM

Try 50cents. No it wasn’t. They really thought they were running out of crude. They felt when Alaska ran out that may be it and that is where Arco’s main supply came from. Arco said you’re nuts. They admittedly went after Arco in Seattle and got buried. Bottomless pit as they put it.

So you are correct they did go for the max price for their product. You would too if you thought your supply was limited. My point is however that the best in the business got it very wrong.

CW20 on February 28, 2013 at 5:53 PM

Sorry, I must disagree, they knew beyond any shadow of a doubt that what they were claiming was flat out wrong. Have you ever seen the official estimates of how much crude oil is being held in “reserve” in the Green River Formation? 3 TRILLION barrels, of which 2 TRILLION are believed to be recoverable.

Over 70 percent of the land containing those 3 TRILLION barrels are directly controlled by the Bureau of Land Management. And the Bureau of Land Management isn’t allowing any new leases for exploration or development.

SWalker on February 28, 2013 at 6:02 PM

I sat at Scott Tinker’s table at a dinner where he gave a talk to a non-prof a couple of years ago. Very pleasant fellow.

Anyway, the article doesn’t even mention the ginormous Eagle Ford play near my city, which is going nutso right now, and has both oil and gas. And there is speculation that the Wolfcamp is even bigger then the Eagle Ford.

juliesa on February 28, 2013 at 6:18 PM

Believe me, some of us do indeed get it, and we not not just offended, we’re pissed the phuck off.

SWalker on February 28, 2013 at 5:52 PM

**ThreadJack** actually I’m powering down my commodore 64 after this comment… but GOOD. Unfortunately once they’ve made it a thought crime to use the word ‘illegal’ to refer to illegal immigrants, the pro legalization of Mexican illegals movement can pretty much write their own ticket.

BoxHead1 on February 28, 2013 at 6:23 PM

Could any cronies of the Administration or party in power benefit from deciding either way?…..or both ways?

Then follow the money to Finaldecisionville.

PappyD61 on February 28, 2013 at 6:30 PM

Hey maybe those new Google glasses will be fitted on Mexican illegals so they could be watched. Heck what if oilfield workers wore them?

Maybe we should all wear them then we could all be monitored by big bro looking through our glasses, like our new SmartTVs.

This isn’t the “Information Age” anymore. After 9/11 we entered the “Surveillance Age”.

PappyD61 on February 28, 2013 at 6:37 PM

“We are looking at multi, multi decades of growth,”

There’s a pent up boom just waiting to happen. Give us four years and we will make it happen, hopefully in such a way that the progs will not be able to roll it back.

petefrt on February 28, 2013 at 6:38 PM

I keep posting to the wrong thread :(

BoxHead1 on February 28, 2013 at 5:54 PM

Don’t feel bad. I posted for three days before I realized I was at HuffPo. :)

petefrt on February 28, 2013 at 6:46 PM

Breaking: Obama Sends 1,400 Manufacturing Jobs & Sensitive Technology to Brazil
Beechcraft fought to keep it here and the government overrode their wishes to keep jobs and our security secrets here. This government is the most corrupt on earth. Brazil works with the islamic nations to share weapons to defeat the U.S. and Obama gives it to them.
http://www.thegatewaypundit.com/2013/02/breaking-obama-sends-1400-manufacturing-jobs-sensitive-technology-to-brazil/

lovingmyUSA on February 28, 2013 at 6:46 PM

“We are looking at multi, multi decades of growth,”

There’s a pent up boom just waiting to happen. Give us four years and we will make it happen, hopefully in such a way that the progs will not be able to roll it back.

petefrt on February 28, 2013 at 6:38 PM

Let me tell you a funny story. It involves the progressive Liberal Marxist Democrat enviro-Nazi’s in California, one of the largest Shale Oil Play’s in America and a State government going bankrupt at nearly the speed of light… <—- insert schadenfreude evil grin here…

SWalker on February 28, 2013 at 6:46 PM

Breaking: Obama Sends 1,400 Manufacturing Jobs & Sensitive Technology to Brazil
Beechcraft fought to keep it here and the government overrode their wishes to keep jobs and our security secrets here. This government is the most corrupt on earth. Brazil works with the islamic nations to share weapons to defeat the U.S. and Obama gives it to them.
http://www.thegatewaypundit.com/2013/02/breaking-obama-sends-1400-manufacturing-jobs-sensitive-technology-to-brazil/

lovingmyUSA on February 28, 2013 at 6:46 PM

High Crimes and Misdemeanors. Nuff said…

SWalker on February 28, 2013 at 6:48 PM

Sorry, I must disagree, they knew beyond any shadow of a doubt that what they were claiming was flat out wrong. Have you ever seen the official estimates of how much crude oil is being held in “reserve” in the Green River Formation? 3 TRILLION barrels, of which 2 TRILLION are believed to be recoverable.

Over 70 percent of the land containing those 3 TRILLION barrels are directly controlled by the Bureau of Land Management. And the Bureau of Land Management isn’t allowing any new leases for exploration or development.

SWalker on February 28, 2013 at 6:02 PM

A few things in regards to this thread:

CW20 is right, in that back in the 1970′s all the majors thought that their ability to find recoverable oil was on the decline. Exploration and drilling innovations that we now take for granted (e.g., ultra deep water drilling and the whole shale oil thing) were not on anyone’s near term radar back in the early days of the arab oil embargo of 1973. In essence, you had some very smart people who were not able to see around the bend – which shouldn’t come as much of a surprise.

Right now there is a huge argument in financial and industry circles regarding the long-term viability of so-called “tight gas” and shale gas (and oil). It’s still relatively new and the wellhead production profiles are quite different from conventional wells, hence the conservative production estimates. The principle of 20/20 hindsight should be considered here.

Finally, the Green River formation is mostly kerogens, which (like shale and tar sands were back in the 1970′s), although it may be recoverable from a process standpoint, the cost to convert kerogens into usable oil is currently not economically feasible. Still, it is right to fight the Government (in terms of how it has effectively locked up access) for exploration and drilling rights, in that one day someone will find a way to make kerogens economically viable – and when that day comes, we will be sitting on a veritable ocean of beautiful hydrocarbon energy.

I would suggest to you that the maxim, “never ascribe to malice what can be explained by stupidity” be applied here: smart people got it wrong back in the 1970′s not because of some evil plan to raise the price of oil, but rather, because their financial foresight tends to be quarterly and does not match the time it takes to commercialise production and consumption innovations.

My two cents.

Wanderlust on February 28, 2013 at 6:48 PM

SWalker on February 28, 2013 at 6:46 PM

Right, the voodoo environmentalists in bankrupt CA refuse to use their own resources and then call on the rest of us to bail them out.

If Obama starts bailing out states, I think we’re in for some serious problems about preserving the Union.

petefrt on February 28, 2013 at 6:51 PM

My two cents.

Wanderlust on February 28, 2013 at 6:48 PM

Sorry, still have to disagree, the Green River Formation was discovered back in the 1930′s. Anyone who thought that we would not eventually figure out how to tap the largest oil field on earth was intentionally deceiving themselves. In the 1940′s the United states Government declared the Green River Formation a “War Resource” and put it off limits for development.

SWalker on February 28, 2013 at 6:54 PM

There’s a pent up boom just waiting to happen. Give us four years and we will make it happen, hopefully in such a way that the progs will not be able to roll it back.

petefrt on February 28, 2013 at 6:38 PM

All of this discussion makes me wish I was an adult back in the early 1960′s, back when growth was considered a good thing, there was no challenge that people considered insurmountable, and the consumer wasn’t treated like some clueless moron that required protection because of his own stupidity.

The worst things that happened to the US were the environmental and peace movements – both of which, according to Ion Mihail Pacepa, were initially funded by the KGB at the height of the Cold War. Thanks to both of these movements, we are now so afraid of our collective shadows that progress and upward mobility, once taken as a given, have slowed to a crawl…which suits the purpose of the big government political left, to the detriment of society in general.

Wanderlust on February 28, 2013 at 6:56 PM

SWalker on February 28, 2013 at 6:46 PM

Right, the voodoo environmentalists in bankrupt CA refuse to use their own resources and then call on the rest of us to bail them out.

petefrt on February 28, 2013 at 6:51 PM

True, but in the meantime, it is pure schadenfreude delight to watch the enviro-nazi state officials sweat over their moral dilemma, allow development, which could pay off all of California’s tax deficits for the next 40 years, or remain true to their enviro-nazi beliefs…

SWalker on February 28, 2013 at 6:57 PM

The worst things that happened to the US were the environmental and peace movements – both of which, according to Ion Mihail Pacepa, were initially funded by the KGB at the height of the Cold War. Thanks to both of these movements, we are now so afraid of our collective shadows that progress and upward mobility, once taken as a given, have slowed to a crawl…which suits the purpose of the big government political left, to the detriment of society in general.

Wanderlust on February 28, 2013 at 6:56 PM

On this, we are in complete agreement.

SWalker on February 28, 2013 at 6:59 PM

Wanderlust on February 28, 2013 at 6:56 PM

Couldn’t agree more. The leftists have done what no military force on this earth has been mighty enough to do. It has destroyed us. It has destroyed us from within.

petefrt on February 28, 2013 at 7:02 PM

All of this no thanks to Obama..in your face!!

sadsushi on February 28, 2013 at 8:04 PM

If it will help the economy, Barry is against it.

GarandFan on February 28, 2013 at 8:17 PM

Breaking: Obama Sends 1,400 Manufacturing Jobs & Sensitive Technology to Brazil
Beechcraft fought to keep it here and the government overrode their wishes to keep jobs and our security secrets here. This government is the most corrupt on earth. Brazil works with the islamic nations to share weapons to defeat the U.S. and Obama gives it to them.
http://www.thegatewaypundit.com/2013/02/breaking-obama-sends-1400-manufacturing-jobs-sensitive-technology-to-brazil/

lovingmyUSA on February 28, 2013 at 6:46 PM

UNF***ING believable.

Please Lord forgive me for holding these feelings about this man.

Vengeance is all yours.

tom daschle concerned on February 28, 2013 at 8:23 PM

The U.S. has enough oil and gas for another 1,000 years if we want it. Like Global Warming, Peak Oil estimates are a scam.

scotash on March 1, 2013 at 3:10 PM