It is not just professionals that know about the shale revolution: anyone who's even remotely involved with mineral resources will have at least heard of it, and even people that have nothing to do with oil and natural gas production are often aware of it. The Analytical Center expert Svyatoslav Pikh has published an article in the Fuel and Energy Sector of Russia Magazine, in which he analyzes the shale revolution phenomenon in the US, which brought about major changes in the global economy and in the global energy sector.
Shale Revolution outside the US: Reality or Myth?
According to the expert, as the traditional sources of hydrocarbons began to run dry and the costs of production began to soar, energy companies around the world began to actively look into ways to extract shale oil and natural gas. According to research by the US Energy Information Administration, China, Argentine, Algeria, the US, and Canada have the largest amounts of shale resources in the world. Seeing how there is a lot of interest in shale hydrocarbons around the world, people are beginning to think long and hard about the total amount of share hydrocarbons that we may have as well as about whether extracting them can be cost-effective.
Special equipment and competencies are needed to extract shale resources. Shale plays are characterized by a high degree of variability in the distribution of oil and natural gas, which makes it very difficult to get reliable information about the total amount of gas and oil contained in the rock. Today, cost effective extraction is possible from the shale plays in the US and Canada, but at the global level, the hard-to-get-to hydrocarbons may remain unprofitable for a long time to come because exploration projects targeting shale hydrocarbons are still fairly rare outside the US and Canada and there are a number of barriers having to do with environmental and political factors, the article notes.
The expert notes that conditions conducive to the development of shale hydrocarbon extraction projects are ensured in the US and Canada by a stable competitive market and a transparent licensing system, something neither China, nor Argentine, nor Russia are famous for and those are countries that may very well have large amounts of shale hydrocarbons in their territory.
However, the expert believes that even though the shale revolution has not gone global yet, it's just a question of time. The current equilibrium in the global market of hydrocarbons that has resulted from excess supply and demand growing at an ever slowing rate coupled with the short life cycles for the development of alternative hydrocarbons impacting the optimization of the economy are eventually going to create ideal conditions for a global shale revolution.
For more see Shale Revolution outside the US: Reality or Myth? in the Fuel and Energy Sector of Russia magazine.