November 3, 2008

Natural Gas: Contending Perspectives

Richard Heinberg summarizes the differing perspectives of the peak oil and climate change viewpoints on natural gas:
For Climate Change analysts and activists, emissions are the essence of the problem, and so anything that will reduce emissions is viewed as a solution. If societies shift from using a high-carbon fossil fuel (coal) to a fossil fuel with lower carbon content (natural gas), this an obvious benefit in terms of climate risk—and it is potentially an easy sell to politicians and the general public, because it merely requires a change of fuel, not a sacrifice of convenience or comfort on the part of the general public. And so, again, climate analysts tend to accept at face value official high reserves estimates and production forecasts—in this case, for natural gas.

However, as with oil, production forecasts by the official agencies for natural gas supply have tended to be overly robust. For example, in the U.S. the EIA issued no warning whatever of future domestic natural gas problems prior to the supply shortfalls that became painfully apparent after 2000, as prices more than quadrupled. Nevertheless a few industry insiders had noted disturbing signs: companies were drilling at an accelerating pace in order to maintain production rates, and newer fields (which tended to be smaller) were depleting ever more quickly. By 2003 the U.S. Energy Secretary was proclaiming a natural gas crisis. In the following three years, warm weather (perhaps due to Climate Change) and demand destruction (from the off-shoring of many industrial users of natural gas due to high domestic prices) led to a partial relaxing of prices and general complacency. However, U.S. domestic production appears set to decline further, and likely at a rapid pace.

For depletion analysts and activists, societal dependence on vanishing, non-renewable energy resources is the essence of the greatest dilemma that our society currently faces. We have created a complex, global economic infrastructure built to run on fuels that will start to become scarce and expensive very soon. From this perspective, natural gas is not a solution but an enormous problem: even if the global peak in gas production is 10 to 20 years away, regional shortages are already appearing and will continue to intensify. This means enormous risks for home heating, for the chemicals and plastics industries, and for electrical power generation. Natural gas is and will always be a fuel that is, for the most part, regionally traded (as opposed to liquid fuels, which are more easily shipped). Thus for many nations critical to the world economy—the U.S., Britain, and most of continental Europe—gas cannot serve as a “transition fuel.”

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