Saturday, June 25, 2011

Shale gas is changing the world

Shale gas seems to be everywhere and that changes global energy power politics. It is in places all over the US which have not been known as energy centers. The shale gas in Pennsylvania is a case in point. It is close to major markets and does not need to be piped long distances. The same holds for Canada.

Now we are finding shale gas in Europe from France to Poland. There is shale gas in China. Whether this gas is economical is a different story. It is not clear whether fracking technology will work and what are the environmental costs, but it is very clear that gas can be found with the right technology and at the right price.

This means that the world dynamics of natural gas will change radically. Those countries that have been energy dependent on major gas producers will see new competitive forces. The US may become a natural gas exporter not an importer. Russia may not hold Europe hostage for natural gas. Natural gas may become a better alternative than solar or wind during a transition period. There arefew events tha will chnage energy politics and this is one of them.

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