Our Natural Gas Opportunity

Comments on the potential of U.S. natural gas from new Energy Secretary Ernest Moniz, in a video posted to his Facebook page:

“The way I look at it is that this natural gas boom is a boon. First of all, we all know that it is partially responsible for the decrease in CO2 emissions that we have experienced over the last years in the absence of, at least, over-arching legislation. Secondly, what I would argue is that the way to look at it – and, you know, as gas as kind of a bridge to a very low carbon future – is that it affords us a little bit more time to develop the technologies, to lower the costs of the alternative technologies, to get the market penetration of these new technologies.”

In other words, Moniz is saying that developing our natural gas reserves is key to our energy present and future – and that any discussion of better air must include clean-burning natural gas. The secretary’s comments are so timely, given recent discussion in Washington of federal hydraulic fracturing regulation and the export of liquefied natural gas (LNG). Add in the need for more access to new natural gas reserves, and you’ve got the major factors that will determine whether our natural gas wealth will have the kind of impact Moniz described.

The fact is America has vast natural gas reserves because of shale, developed with hydraulic fracturing and horizontal drilling. Here’s how the U.S. Energy Information Administration charts production growth over the next few decades:

A new Deloitte report says the United States is about to become a “shale globalizer” because of the revolution in unconventional production – again, thanks to fracking – meaning the ability to shape the global natural gas marketplace. The question is whether we’ll fully capitalize on our reserves or whether new layers of regulation, self-imposed export market restrictions and limited access will get in the way.

This week Senate Environment and Natural Resources Committee Chairman Ron Wyden held a couple of roundtable discussions on natural gas, including one focused on safe development. Chemical disclosure, safe drilling operations, emissions and water management got expert attention. Wyden:

“Today, we heard from leaders in the natural gas industry, from the environmental community and committee members on both sides of the aisle, all of whom agree we must continue to work, using a bipartisan approach, to address the concerns associated with increased natural gas production. There are substantial environmental questions here, but there’s no difference of opinion, at least in the Senate, that this is something where we need to try to find common ground. I think there’s a real opportunity for progress.”

Industry is already on it, with operating standards and practices that address everything on the chairman’s list and more:

These result from a detailed process based on input from a broad range of stakeholders, with the goal of developing industry’s benchmarks for performance, interaction with communities and environmental protection. They’re regularly updated to keep pace with new developments in resource knowledge, technology and know-how. Industry standards and effective tools like the FracFocus.org chemical disclosure website show that America’s oil and natural gas companies are committed to safe and responsible development and transparency – all to earn confidence from partnering communities where oil and natural gas are produced.

Our energy-producing states are on it, too, parlaying experience, vast knowledge of their individual geologies and the highest incentive to get energy development right -- to build, with industry’s willing input, effective regulatory regimes that earn praise from federal officials.

These points are worth noting, because Chairman Wyden’s concerns are shared by many Americans. Hydraulic fracturing is safe, as recent studies have shown. And the American people see that our natural gas wealth from shale can meet domestic demand and generate additional wealth here at home by supplying our friends overseas – 71 percent in a recent poll agreeing that LNG exports will help create U.S. jobs and 66 percent agreeing exports will lift our economy.

In a number of ways the shale energy discussion is at a crossroads. We have the reserves, and we have the technology. We need clear policies that will foster continued growth, safely and responsibly. Debate is centered on policy paths – and it was good this week that senators insisted on a fact-based discussion of these issues. It’s imperative for progress toward the future Moniz sketched – well-supplied along the way with affordable energy.