Shale Gas Provokes Debate in Russia

April 9, 2010

 

Deputy Duma Speaker and energy committee member Valery Yazev explained that the decision to study shale gas was made in response to changes in the United State’s gas import program and action being taken into other countries to develop shale gas.

“The reality”, Yazev said, “is that 51 billion cubic meters of gas is being produced in the United States today and that is 6.7 percent of the total amount of gas being produced in America. Today, the US imports 41 billion cubic meters of gas and says it will import significantly more”. He said, “There has been something of a technological breakthrough in shale gas” which has already halted projects to build LNG plants in many countries. The United States, China and Australia have already begun to stop building facilities to produce and handle LNG, though some sites will be reserved.

Canada has also joined in shale gas production. Yazev said that he thinks Russia must absolutely study all the facts related to producing shale gas, since the impact this non-traditional source of energy could be significant on both Russia’s own market and on the country’s export potential.

However, officials in the Russian government itself remain unconvinced. Speaking at the “Russian Fuel and Energy Complex in the Twenty-first Century” on April 8, Energy Minister Sergey Shmatko said that developments in shale gas production in the United States will not affect the global balance of energy resources.

He pointed out that “unnecessary hype” had built up in the world around the issue of shale gas, including in the United States. He said the issue requires serious additional study and added that the shale gas market must also be examined in terms of its possible affect on the world gas market. These issues will likely form the core of discussion at a meeting of gas exporting countries to be held in Iran on April 19.

The high level of shale gas production accompanied by lower demand for gas during the financial crisis opened the gates to the gas spot market. The United States overtook Russia as the world’s leading gas producer in terms of volume for the first time since 2002. According to the US Department of Energy, from January to October 2009 gas production in the country grew 3.9 percent to 519 billion cubic meters – most of this growth was due to shale gas.

Over the same period, gas production n Russia fell 17 percent to 462 billion cubic meters, RBK reports.