global shale | Market analysis


pipeline schemes that are needed to carry off increas- ing volumes of gas from the Marcellus and Utica fields to markets. The developers of the Penn East pipeline, which is designed to connect Penn to a North Jersey suburb, have recently submitted 33 route changes to assuage local opposition. Billions of dollars of projects have been delayed or


cancelled in response to opposition from landowners aggrieved by companies using eminent domain to compulsorily purchase their land, by conservationists wishing to preserve the local habitat, and by climate campaigners wishing to keep fossil fuels underground.


Above: Projects such as the Freeport LNG terminal are turning the US into a major natural gas exporter


has already sent 33 cargoes overseas, 17 to South America, one to China, three each to India, Europe, the Middle East and two to Mexico and the Caribbean. Cheniere is the first of five Coastal LNG export plants -with sufficient customers on long term contracts to guarantee revenues - to be opened. Based on rising supply, burgeoning demand in South America and the reopening of the widened Panama Canal, the US will become a major player in the global LNG trade.


Pipelines and US politics It is difficult to take the politics out of the Oil & Gas industry. During his campaign, President-elect Donald Trump promised to “lift the restrictions on American energy” and claimed that the shale energy revolution would “unleash massive wealth for American workers and families.” While we are yet to see how that translates into action after his inauguration next year, it seems likely that the Trump presidency combined with continued Republican control of the Senate and Congress will see an administration that is considerably more favourable to the US oil and gas industry than the outgoing one. However, there is plenty of opposition to both


Right: Further expansion of US shale pipelines is


facing increas- ing domestic opposition


fracking and to the construction of the necessary pipelines. This comes from an increasingly well-organ- ised coalition of environmentalists, climate campaign- ers and conservationists. In Oklahoma, for example, the rise in the number of quakes registering 3.0 or more has caused a fracking backlash and, in response, the state has issued restrictions aimed at what is seen as the likeliest cause – the injection of wastewater. In September this year, protesters interrupted work


at the Vermont gas pipeline worksite in support of campaigners in North Dakota fighting against the Dakota Access Pipeline passing near the Standing Rock Sioux Tribe Reservation. The result appears to be a rerouting of the pipeline around Missouri River and man-made Lake Oahe, which are sources of drinking water for the reservation. Densely populated New York and Connecticut state are also magnets for vociferous opposition to the new


14 PIPELINE COATING | December 2016 www.pipeline-coating.com


Global developments China had the largest acknowledged shale gas reserves in the world in 2013. Since then, according to the Ministry of Land and Resources, the country has “spared no efforts in searching for new resources.” The result, according to a recent Bloomberg report, is that the country’s recoverable shale reserves have been raised five- fold.Output has been limited, however, by complex geology, the four-kilometre depth of resources, lack of infrastructure, water shortages and comparative lack of experience in shale. In 2015, Chinese shale gas output amounted only to 4.47 bcm. However, BP recently signed its second exploration and production sharing deal with CNPC and, in its latest Energy Outlook, predicts China’s shale gas production will rise to 13 bcf/d by 2035. The EIA ranked Argentina second in the world for


technically recoverable shale gas in 2013, with volumes of 802 tcf, and fourth for shale oil at 27bn barrels of shale oil. While little of this has been recovered, the change of government in December 2015 could well inaugurate a lift-off in drilling for gas and oil in Argentina’s crown jewel, the Vaca Muerta shale formation. Already, the new government has improved the investment climate by returning to international


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