“Well, in our country,” said Alice, still panting a little, “you’d generally get to somewhere else — if you run very fast for a long time, as we’ve been doing.”
“A slow sort of country!” said the Queen. “Now, here, you see, it takes all the running you can do, to keep in the same place. If you want to get somewhere else, you must run at least twice as fast as that!”
Lewis Carroll’s “Through the Looking Glass” captures the challenges of shale gas production well: technology must advance ever faster purely in order for production to stand still. Why? Because you are for ever depleting relatively easy-to-exploit resources and replacing them with ever more difficult-to-exploit resources. Yet the US government’s Energy Information Agency says we will run faster. Here is their long-term forecast from the Annual Energy Outlook 2013.
But notice that the EIA sees production moving sideways for a few years. From their Short-Term Outlook:
I’ve reproduced these charts before, but a couple of weeks ago the EIA produced a fascinating report (composed of charts but no text) showing production of new and legacy shale gas wells. It also covered tight oil but I wish to leave that discussion to another time. Now the shale gas producing areas have entered the business lexicon if you ever read the financial press, but as an aide-memoire here they are geographically (click for larger image): Continue reading