The U.S. has 2,384 trillion cubic feet of recoverable natural gas according to an industry estimate, twice what a similar study concluded nine years ago as drillers began tapping shale formations using a technique known as hydraulic fracturing.
The estimate is the highest in the 48 years the Potential Gas Committee has assessed resources and exceeds by more than 25 percent the previous estimate of two years ago, the panel said today in its latest nationwide analysis. Much of the growth in estimated underground assets came in eastern states such as Pennsylvania, where shale-gas has been opened up by companies such as Chesapeake Energy Corp. (CHK) and Range Resources Corp. (RRC) using hydraulic fracturing, also known as fracking.
“It’s really shale gas that has exceeded expectations,” John Curtis, a professor at the Colorado School of Mines who led the study, said in Washington. “Our present assessment, strengthened by robust domestic production levels, demonstrates the exceptionally strong and optimistic gas supply picture.”
Fracking, in which water, sand and chemicals are shot underground to break apart rock and free natural gas trapped in shale, has brought a boom in energy production to Pennsylvania, Texas and Colorado, and lowered natural gas prices.
Natural gas for May delivery fell 7.1 cents, or 1.7 percent, to $4.01 per million British thermal units at 2:03 p.m. on the New York Mercantile Exchange. Natural gas will probably drop 10 percent before July and will stay in a price range of $3.50 to $4.50 per million Btu this year as supplies remain “robust,” James Sullivan, an analyst at Alembic Global Advisors in New York, said in a note to clients today.
Fracking has also raised concerns of environmentalists and some landowners, who say its leading to contaminated air and water. Overall, 45 percent of those familiar with hydraulic fracturing say they support its use, while while 41 percent oppose the practice, according to the University of Texas Energy Poll, which was released today. A growing share of consumers, 43 percent, said they support greater regulation of the practice.
Gas production in the U.S. rose to an all-time high of 28.5 trillion cubic feet in 2011, led by record output from shale deposits, according to the Energy Information Administration. Shale accounted for 30 percent of total production in 2011, up from 22 percent the previous year.
If production stayed at that level, U.S. resources of natural gas could last for nearly a century if the current estimate is correct. The committee doesn’t include a time frame for when or if this natural gas would be tapped.
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