Well it seems likely a long stretch of high oil prices combined with declining conventional reserves will act as a strong incentive to take a long hard look at unconventional oil. It might even act to change some of the barriers to entry like political and legal barriers, attract qualified talent, fund needed infrastructure development, etc. However that still leaves the problem of the geology. Rockman or Rockdoc would be better suited to address this point. However they have spoken of a multitude of geological factors that have to be just right to make fracking a formation viable. Of the plethora of global tight oil resources, how much will ultimately be recovered? A small fraction I'd wager. Getting a better idea of the exact fraction will require more test wells to be drilled.
rockdoc123 wrote:I liken this to the same thing we saw with the rush to Poland shale gas 2 years ago with trillions of cubic feet predicted. In reality what has happened is that a few wells drilled have shown the shales aren’t necessarily conducive to fraccing, they don’t have the right mineraology and they aren’t over-pressured. Yes they have the organic content and you can estimate huge resources based on that but you can’t get that gas/oil out of the rock and never will.
Why we shouldn't worry about end timesWe might get a better idea on which countries have shale potential in the years ahead as activity picks up in other countries:
Let’s start in Argentina, which contains the Vaca Muerta shale formation, one of the world’s largest. Argentina has more shale gas than the United States, and is second only to China, but thus far has yet to ramp up commercial production. But companies are spending more money on exploratory drilling in the region (to the tune of $1 billion per year), and according to Argentinian Energy Minister Juan José Aranguren, the Vaca Muerta will attract $15 billion annually in investment by 2020.
Moscow was slow to embrace the shale boom, initially dismissing it as a fringe phenomenon, but thanks to the current price of oil (in large part a result of surging American output from fracking), it now recognizes the importance of these unconventional reserves. Gazprom Neft—the oil division of the state-owned gas company Gazprom—has begun trying to frack without American assistance. As Gazprom Neft’s director of exploration Alexei Vashkevich put it, “it’s not a question of will we do it or not: it’s a question of time. It might take a little bit longer but we will get there.”
China may be the closest to replicating the American shale experience. China doesn’t have much tight oil, but it has far and away the world’s largest reserves of shale gas, and it has strong reasons to want to develop them, both in terms of pursuing greater energy security (and reducing reliance on energy imports), and also in order to reduce the amount of coal it burns for electricity and heat—and all of the toxic smog that that entails. China’s Ministry of Land and Resources said that in 2016 it upped shale production more than 75 percent to 7.9 billion cubic meters, and hopes to hit 30 billion cubic meters by 2020 and between 80 and 100 billion cubic meters by 2030. The certainty of those numbers is suspect, as are most official statistics coming out of China, but there’s no doubt that a lot of natural gas is lying fallow in Chinese shale formations, and that Beijing is working hard to extract it.
Closer to home, Mexico just opened up its most promising shale region for business, as the country’s Energy Ministry offered foreign private companies access to onshore blocks of its Burgos basin—the same geologic formation that underlies Texas’s highly productive Eagle Ford region, one of America’s shale hotspots. Mexico has nearly as much shale gas as the United States, and now that it has denationalized its hydrocarbon reserves and opened them up to private companies, firms with the know-how and the profit motivation can start trying to get a foothold in the country. Canada has been fracking since 2008, so if Mexico were to join in, it would make the shale boom a North American phenomenon.
The State of Global Shale