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Shell CEO: Nat Gas To Play Prominent Global Energy Role

THE WALL STREET JOURNAL

SEPTEMBER 13, 2010

By Angel Gonzalez and Mark Peters Of DOW JONES NEWSWIRES

MONTREAL (Dow Jones)–Natural gas, boosted by recent breakthroughs in its production and its relatively small carbon footprint, will play a prominent role in the world’s energy future, as long as global energy policies allow it to fill an increasing share of demand, Royal Dutch Shell PLC’s (RDSA, RDSB) Chief Executive Peter Voser said Monday.

“If we create space for natural gas to grow, natural gas will change the world’s energy landscape for the better,” Voser said at the World Energy Congress in Montreal.

The supply picture for natural gas has changed dramatically since North American companies figured out how to profitably exploit tight rock formations called “shales” in the last decade. Now the world has enough gas to keep producing for 250 years at the current rate, Voser said. Although the onslaught of supply, combined with the economic crisis’ damping effect on demand has depressed prices, the long-term appetite for the fuel “will keep pace with supplies,” Voser said, because of economic growth in emerging markets.

Shell believes that demand could rise by 50% to 165 trillion cubic feet per year by 2030, twice as fast as demand for crude oil.

Voser’s comments come as the unexpected rise of shale gas has disrupted the capital investment plans of many energy companies, which until recently thought that the trading of liquefied natural gas would be the key driver of the fossil fuel’s future, and expected North America to become a major consumer of LNG. The continent, however, won’t have the need for stable supplies of LNG “anytime soon,” he said, although there will be some room for the occasional cargo. Western Europe and Asia will drive LNG demand, in part because European shale gas output won’t take off before 2020 and because the rapid growth of natural gas demand in China and other emerging economies. China and other Asian countries are “keen to secure supplies through long-term contracts.”

The interplay between shale gas and LNG, however, is not a zero-sum game. The two “mutually reinforce” each other, giving greater confidence to investors that large supplies of natural gas are here to stay, Voser said.

Voser said the company takes seriously environmental concerns over the impact shale gas production may have on water supplies in North America, acknowledging that the last year has shown things can go wrong. The shale gas Shell produces lies in the ground well below water sources, and Shell is lining its wells with concrete and steel as a protective measure.

“We comply with regulations and follow strict procedures to ensure that the process is safe,” Voser said.

He added that government policies must help carve out a place for the growing supplies of natural gas. The creation of carbon emissions regulation that would create “robust” prices for carbon, or stricter emission standards for power plants to discourage the use of coal, would help spur demand for natural gas. Also, there are natural gas-fired plants in Europe and the U.S. that are being used at about 40% of their potential capacity; if their use can be ramped up, natural gas usage would rapidly increase, he said.

Voser added that governments should also help the energy industry develop new technologies to fight carbon emissions, particularly by backing carbon capture and sequestration projects. These projects are quite expensive and produce no revenue, making them difficult to finance.

At a press conference on the sidelines of the event, Voser said that North America, particularly Canada, could in the long term become a source of LNG for Asia. Exports from the U.S. could be difficult, as development of gas resources there has been so far geared to supplying the domestic market, but in “the very long run” such exports cannot be discounted, he said.

-By Angel Gonzalez, Dow Jones Newswires; 713-547-9214; [email protected]

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1 Comment on “Shell CEO: Nat Gas To Play Prominent Global Energy Role”

  1. #1 lamare
    on Sep 14th, 2010 at 12:27

    I think these guys may be in for a little surprise about what will be the energy source of the future. It won’t be a fossil fuel. It will be the electric field, available for free all across the universe.

    Let me first mention that I hold a Masters degree in Electrical Engineering. I never believed any claims that there would be such thing as “free energy”. Energy that is basically free for the taking for virtually nuts. Sure, you have solar energy, but solar panels are that expensive to make that they are not interesting from an economic point of view.

    But, curious as I am, I did investigate some of the systems that claimed to produce energy out of seemingly nothing. What I found out is that when you look at the dirty details of what we know as electricity, it is the electric field that really powers our circuits. While it seems like we convert mechanical energy into electrical energy by turning the shaft of a generator, in reality it is the electric field that powers our circuits.

    Each and every charge carrier in the universe emits an electric field for free, 4/7, 7 days a week, 365 days a year, indefinately. And that electric field contains energy, as has been shown without a shadow of a doubt by the German Prof. Claus Turtur:

    http://www.wbabin.net/physics/turtur1e.pdf

    In the chapter “A circulation of energy of the electrostatic field” (pages 10-14) he makes a straightforward calculation of the energy density of the static electric field surrounding a point charge using nothing more than Coulombs law and the known propagation speed of the electric field, the speed of light, and shows that there must be some kind of energy circulation between the vacuum and charge carriers, which eventually leads to the conclusion that the electric field is a wonderful and free energy source. And that means it it not a question of if but how to use this energy source to give us as much clean, non polluting energy as we like, for free.

    So, with this knowledge I investigated three independent inventions that claimed to be able to power cars seemingly out of nothing. And to my own surprise they all turned out the use the same basic principle, a principle that can be explained from the bottom up without any difficulty using nothing but hard electrical engineering theory.

    So, there we are. We know the electric field is an clean energy source that is free for the taking and we know how three independent inventions, of which two have been shown to work in public, used this energy source using the exact same set of tricks. So, it is only a matter of time now before all the oil companies will be out of business and fossil fuel will be a thing of the past.

    If you are interested, you can read all about how to pull this off, in principle, over here:
    http://peswiki.com/index.php/Article:Free_Electric_Energy_in_Theory_and_Practice

    I must stress that this is a work in progress, but the basic stuff is there for everyone to see, for free. No strings attached.

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