General Mtg: Shale Gas, Emerging Fundamentals, and Geopolitics
During the past decade, innovative new techniques involving the use of horizontal drilling with hydraulic fracturing have resulted in the rapid growth in production of natural gas from shale. Although geologists have long known about the existence of shale formations, accessing those resources was long held to be nearly impossible due to the existing state of technology and high costs. But recent innovations have made shale gas production a commercial reality. This, in turn, has resulted in substantial change in the natural gas supply picture in North America. Moreover, it has had a ripple effect around the globe, not only through displacement of supplies in global trade, but also by fostering a growing interest in shale resource potential in other parts of the world.
One outgrowth of shale gas in North America (by displacement) has been increasing liquidity in natural gas markets around the globe, notwithstanding the effects of the disaster at Fukushima. In fact, European suppliers are already accepting lower contracted prices for natural gas, even allowing some sales to be indexed to spot natural gas markets, or regional hubs, rather than oil prices. This is a major paradigm shift in Europe, and could be the first signal that traditional pricing paradigms may become a thing of the past.
Shale gas developments in North America have also pushed some to consider exporting LNG, which represents an about-face from previous expectations. However, many developers missed shale gas in North America, which led to significant ex post negative investments in LNG import capacity. Is it possible this will occur abroad, and if so, what does it mean for the prospect of LNG exports from North America?
In addition, how might other convoluting factors, such as the role of exchange rates in determining arbitrage opportunities, influence the prospects for LNG exports? The answer to these questions is as much rooted in international trade and finance as it is in geology and resource availability. Moreover, it has significant implications for the development of markets and geopolitical relationships in the coming decades.
MENU
SPINACH SALAD
BAKED CHICKEN W/ DRESSING
ITALIAN CREAM CAKE
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Parking for this event :
The Petroleum Club provides valet parking service on the Milam Street side of the EXXON-MOBIL Building. Parking is also available at public parking lots in the area for a fee in the $5 - $7 range.
Location:
PETROLEUM CLUB, 43rd floor, EXXONMOBIL Building
800 BELL STREET
HOUSTON
,
TEXAS 77002