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US shale gas here to stay

09 May 2011

The surge in US shale gas production presents huge opportunities for power and midstream gas project financings. But production and environmental costs are not fully understood. By Edward Russell.

Natural gas produced from unconventional sources such as shale formations has the potential to recast the economics of the power, oil and gas sectors. Its availability is creat­ing opportunities for project financings of everything from midstream assets to new power plants and liquefied natural gas (LNG) export terminals, but environmental concerns and an unclear regulatory outlook could dampen the boom. There were 60.6 trillion cubic feet of proven shale gas reserves in the US at the end of 2009 according to the US Energy Information Agency (EIA). These reserves are equal to 21% of the total proven natural gas reserves in the country and up from less than 1% of total reserves as recently as 2000. Shale gas fields, commonly referred to as plays, are largely located in the east, south and Rocky Mountain west with concentrations in Arkansas, Louisiana, New York, Oklahoma, Pennsylvania, Texas and West Virginia. Major plays...


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