Australia has experienced explosive growth in its natural gas production over the past decade, and is on track to become the world’s leading exporter of liquefied natural gas (LNG) by 2018. In addition to the massive projects already on track to develop Australia’s conventional and coal seam gas resources.
ACE member Rob Perrons, whose research explores the role of entrepreneurs and start-ups in the energy sector, was recently interviewed by Canale Energia, a major financial news provider in Italy. The Italian news outlet asked about the impact that Australia’s considerable shale gas resources could potentially have on global markets. Rob had this to say: “It’s becoming increasingly clear that Australia does indeed have a significant amount of gas-bearing shale, but it’s unlikely to become economically viable anytime soon. Why? The American “shale gale” has the benefit of having (1) a massive network of pipelines already in place all around the country, so the new gas production can tap into existing infrastructure, (2) there are roads to everywhere in the US that they need to get the people and equipment to, and (3) the US already has a well-developed army of service contractors, equipment, and petroleum engineers who are able to do all the work. All three of these ingredients are missing in Australia. Thus, even though Australia has a lot of shale gas, it probably won’t result in a lot of immediate action. And in light of the low prices in LNG brought about by the Americans making so much of this stuff—and their clear intention to export a lot of it to Pacific customers—it’s hard to imagine a scenario where Australia’s shale gas plays take off like a rocket.”