The next few days will…
Secretary of State Antony Blinken…
Robin Meige, the director of strategy at the European Commission’s DG Environment, put a bit of a downer on Europe’s plan to use hydraulic fracturing to experience a shale boom and drive gas prices down, when he explained that conditions in Europe were a little different.
Europe’s energy prices are double those in the US, and leaders are turning to unconventional sources of fossil fuel as a means to increase supply to the market, and hopefully force prices down.
Geological and geographical differences in Europe compared to the US, along with a higher population density, and lack of natural gas infrastructure in many places, mean that, according to the IEA, production costs for unconventional gas extraction techniques in Europe will be twice the price than in the US.
Related article: Haynesville: True Staying Power
Miege explained that the “effects of a possible future domestic shale gas production on energy prices in the EU still need to be ascertained,” and any decrease would “probably be much less than was initially foreseen.”
Shale gas supporters in the UK still firmly believe that fracking holds their energy salvation and will cause energy bills to fall, and that “significant exploitation of British shale gas across the continent could reduce our exposure to hydrocarbon price volatility on the world markets. That could contribute to the stabilisation of British energy costs – good for homes and for businesses – at the very least,” as stated by MP Christopher Pincher.
However Miege said that “in a most optimistic case, European shale gas can only compensate for declines in domestic conventional gas, it won’t make Europe self-sufficient by itself. Further exploration would be needed to determine the level of reserves. That is met with public opposition in some countries, so we find ourselves in a catch-22 situation.”
By. Joao Peixe of Oilprice.com
Joao is a writer for Oilprice.com