Econintersect: The U.S. Department of Energy has released a report assessing the extent of accessible shale gas and oil deposits in the world. This comes only two years after the last EIA (Energy Information Agency) report on estimates of these resources. This short interlude has resulted from the rapid development of data on shale formations. The number of formations covered by this report has almost doubled from the 2011 document, from 69 to 137. The number of basins has increased similarly from 48 to 95. Extensive resources have been identified on every continent except for Antarctica. Only the “most prospective” resources have been included.
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There is a lot of uncertainty when interpreting the resource estimates provided by the EIA (or any other source, such as ARI – Advanced Resources International). From the June 10 report:
Because they have proven to be quickly producible in large volumes at a relatively low cost, tight oil and shale gas resources have revolutionized U.S. oil and natural gas production, providing 29 percent of total U.S. crude oil production and 40 percent of total U.S. natural gas production in 2012. However, given the variation across the world’s shale formations in both geology and above-the-ground conditions, the extent to which global technically recoverable shale resources will prove to be economically recoverable is not yet clear. The market effect of shale resources outside the United States will depend on their own production costs, volumes, and wellhead prices. For example, a potential shale well that costs twice as much and produces half the output of a typical U.S. well would be unlikely to back out current supply sources of oil or natural gas. In many cases, even significantly smaller differences in costs, well productivity, or both can make the difference between a resource that is a market game changer and one that is economically irrelevant at current market prices.
The current global status of estimated shale oil and gas resources is displayed on the map below.
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An often repeated hyperbole is the The United States is the Saudi Arabia of shale gas. Well, that statement is just that: pure hyperbole. The U.S. is ranked second in recoverable shale oil resources behind Russia, but is ranked lower for shale gas. The U.S. has just 9% of the shale gas for the top ten countries in the world. The three countries ranked higher than the U.S. have almost four times as much shale gas, according to EIA data.
Sources:
- Technically Recoverable Shale Oil and Shale Gas Resources: An Assessment of 137 Shale Formations in 41 Countries Outside the United States (Energy Information Agency Report, 10 June 2013)
- World has 10 years of shale oil, reports US (Gregory Meyer, Financial Times, 10 June 2013)
