Encouraging news...but little of it

The good news:  Shale gas, the big transformer of US gas markets, is to go international.

 Washington (Platts)--12Jun2009
US independent gas producer Chesapeake Energy is entering into a joint
venture with Norway's StatoilHydro to look for shale natural gas plays outside
the US, Chesapeake CEO Aubrey McClendon revealed Friday.

     McClendon said his Oklahoma City-based company, the second largest gas
producer in the US, will contribute technology and expertise to complement
StatoilHydro's international breadth in a 50/50 joint venture to exploit gas
shales worldwide.

     "I see this news as most encouraging," McClendon said, predicting the
world will start to transaction away from crude oil to natural gas for fuel.

Talking is the first step to doing, and Statoil Hydro has previously said they are looking at 14 plays around the world.

But for now, Chesapeake is saying the minimum.  Just because no one is showing the detail, doesn't mean they aren't at least showing the hand:

Beyond his two sentence disclosure during a presentation at Chesapeake's
annual shareholder meeting at a downtown Oklahoma City hotel, McClendon
provided no other details of the StatoilHydro deal.

Just one Marcellus or Barnett size shale out of 14 elsewhere in the world can change the international, then the LNG and UK prices.  Sounds like good odds.  No wonder nobody is any rush to say where.  Europe is one source, but we'll settle for one anywhere. China?

Comments

[Ed Crooks]

Further to our discussion below about shale gas:
http://nohotair.typepad.co.uk/no_hot_air/2009/06/the-ft-discovers-shale-gas.html

...the FT covered the Statoil / Chesapeake deal seven months ago, here:
http://www.ft.com/cms/s/0/ccb003c2-b028-11dd-a795-0000779fd18c.html

All the best

Ed

[Gas Guru]

But the FT missed the recent things that Statoil have been saying about shale outside North America (and a new story today from Exxon about Dutch gas).

I'm no geologist. But I look at maps of North American shale and say how on earth could there NOT be similar plays elsewhere in the world. Imagine one Barnett shale size find in China for example: The LNG market to China will disappear within two years, and what kind of impact will that have on prices? Shale is the story I'd like the FT to start covering. Very few people in the UK have ever heard of it. They still believe there is a shortage. I mentioned this to alleged energy expert recently and he had never heard of it. Peak Oil and all that rubbish is so 2006. What is particularly fun about shale is how people as divergent as Greenspan and Greenpeace both got it all so horribly wrong!

I love shale stories because I have a fascination for how the conventional wisdom was so incredibly wrong. Schadenfreude is a bit of it sure, but who's to say that that isn't a damn good reason, and an entertaining one.