Daniel Yergin: Why shale gas is like Walmart

The breakthrough energy innovation of the 21st century is not thin-film solar, sophisticated wind turbines, advanced biofuels or small-scale nukes.

It’s shale gas.

So says Daniel Yergin, the energy guru and author of The Quest: Energy, Security and the Remaking of the Modern World (Penguin, $35), who was interviewed today (Nov. 8) by Walter Isaacson at the Aspen Institute in Washington. Yergin, the best-selling author, consultant and all-around energy guru, is right: The ability to extract natural gas from shale, using a controversial technique known as fracking, is reshaping America’s energy landscape.

“So far this century, this is the biggest innovation in energy, in terms of scale and impact,” Yergin said. He likened its impact on the energy business to the arrival of a new Walmart in town, which shakes up competitors, big and small.

The impact of cheap, abundant natural gas on energy usage has enormous implications for the climate crisis.

Cleaner-burning gas could replace dirty coal as a fuel to generate electricity. Then again, Yergin said: “It’s does create a more challenging marketplace for wind and solar and everything else.” [click to continue…]

GE’s Mark Vachon: “Gas is massive”

Mark Vachon

How’s GE’s ecomagination  going?

I put that question today to Mark Vachon, who is vice president for ecomagination at GE. He replied by talking about natural gas.

“The large macro trend of gas is massive,” he said. “Our oil and gas business will be a huge beneficiary.”

An abundance of shale gas in the U.S., and methane gas reserves in Australia present a wealth of opportunities for GE, which plays all along the supply chain for natural gas.

“We’re a massive player in gas exploration,” Mark said. “We have a water business that can deal with issues in the fracking process.” And, of course, GE sells lots of gas-burning turbines, including a new combined cycle power plant, currently available in Europe, that enables gas to be burned more efficiently and in concert with renewable energy. (See my June blogpost, GE’s big bet on natural gas)

But can you put “ecomagination and shale gas in the same sentence? Yes,” Mark said. GE will focus on making shale gas cleaner, “with technologies like zero-leak valves” and water filtration products like a mobile evaporator that is basically a truck (see below) “designed to enable on-site frac water recycling, reducing the volume of wastewater and fresh water that needs to be hauled to and from the project site.” [click to continue…]

Shell: We need tough fracking rules

Marvin Odum, the president of Shell Oil, made a revealing and insightful observation at the “Shell 2011 Energy Summit” last week in Houston.

“You are only as good as the worst operator in your industry,” he said.

Marvin Odum

He could have been talking about BP. Shell wants to drill offshore in Alaska, home to some of the richest undeveloped oil and gas reserves in North America, but there’s little chance of that so long as memories of the BP Deepwater oil spill remain fresh.

Or he could have been talking about the Tokyo Electric Power Co. Last month’s accident at Fukushima has cast a cloud over hopes for a global nuclear renaissance, fueling opposition to nukes from India to Germany to Minnesota.

In fact, he was talking about hydrofracking—the technology that will allow vast amounts of natural gas to be tapped from fields around the U.S., creating a boom in the shale fields of Wyoming, Texas, Louisiana and Pennsylvania.

But fracking, as it’s called, is controversial. When wells are improperly drilled, water supplies can become polluted. Some gas drilling companies won’t say what chemicals they are injecting into the shale to drive out the gas. Just last week, an unpublished study challenged the conventional wisdom that natural gas is a cleaner fuel than coal, arguing that the release of methane during drilling could aggravate global warming.

To head off the criticism, and clean up the highly-fragmented natural gas drilling industry,  Shell wants strong regulation of hydrofracking. The company says it will monitor its own wells carefully and disclose the chemicals it uses in its fracking fluids.  The goal, it appears, is to engage with critics and demonstrate to them that when well managed, fracking has benefits that far outweigh any harm. [click to continue…]