Enthusiasm over the US natural gas production renaissance has been steadily building over the past few years and increasing production of both gas and oil from shale deposits came up numerous times during the 2012 US presidential election cycle. However, not everyone views shale gas as a supply panacea, which is the thrust of a book due out next spring written by Bill Powers with a forward by Arthur Berman.
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This is the second article in a two-part AOL Energy series - read part one here.
Potential Gas Committee executive director John Curtis rejected Berman's reliance on the committee's "probable" category, which is based on gas in existing fields.
"He's dead wrong," Curtis said, arguing that restricting the resource estimate to only "probable" gas ignores the existence of highly productive plays like the Marcellus and the Haynesville that were not initially included in that category because they had not been drilled.
Curtis added that any deficit between a field's actual production and its resource estimate may reflect a lack of pipelines or undeveloped markets for the gas rather than a resource that undershoots expectations.
The PGC's latest estimate, published in 2010, is for total US shale resource of 687 tcf, including "probable", "possible" and "speculative" gas. Including all categories of gas, the committee estimated a total resource of 1,900 tcf, not far below the EIA's assessment of 2,203 tcf.
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Ahead of the next PGC report, due in April 2013, Curtis said there was no indication of a need to cut its current estimate of gas resources, and there had not been in 2010 compared with the previous report two years earlier.
The Thorny Issue of Reserve Estimates
"From year-end 2008 to year-end 2010 we saw no reason to move away from our position for the quality and quantity of resources, and from 2010 to now we still do not," he said.
For his part, Powers cited the EIA's own data in support of his case, noting that the organization sharply cut its estimate of unproved technically recoverable resource to 482 tcf in the latest outlook from 827 tcf a year earlier, largely because of a big decline in its TRR estimate for the Marcellus Shale to 141 tcf from 410 tcf a year earlier.
"The EIA is starting to walk back from its earlier claims," Powers said, in an interview ahead of the book's scheduled publication in May 2013. He said the EIA's credibility was hurt when it cut its Marcellus estimate after the US Geological Survey calculated in its own 2011 study that the Appalachian shale play contained just 84 tcf.
Philip Budzik, a spokesman for the EIA, said the changing estimates reflect the industry's increasing experience in the field. "The numbers have been changing significantly over the last couple of years," he said. "Producers have been experimenting with drilling and completion techniques."
Any confirmed cut in US shale gas resources could have far-reaching consequences ranging from reduced energy security to more greenhouse gas emissions and higher energy costs. With increased production and optimistic projections for recoverable resources, natural gas is assuming an increasingly important role in US energy policy.
The EIA estimated the TRR for all forms of natural gas including tight gas and coal bed methane is 2,203 tcf, or about a century's supply at the current national consumption rate of some 24 tcf a year. Shale gas represents about a quarter of the EIA's total, or around 22 years' worth; that resource would shrink to just 5.5 years if Powers is right.
Dan Whitten, a spokesman for the trade group America's Natural Gas Alliance, rejected Powers's estimates, saying that shale gas production has risen more than 12-fold over the last decade, and estimates of recoverable resources have risen at a similar rate. Whitten said Powers's assertions have been refuted by prominent organizations including the Massachusetts Institute of Technology and the Potential Gas Committee.