IEA says proper rules can bring gas ‘golden age’


The coming decades could be a golden age for natural gas if unconventional resources are exploited in an environmentally acceptable manner, the International Energy Agency said Tuesday.

In a new report, the IEA proposed a set of “golden rules” that would spur gas development by imposing high environmental standards to reassure a wary public.

Stiff public opposition represents a key obstacle to broad development of known resources.

A potentially “bright future” is far from assured, the IEA said, as long as “social and environmental concerns” associated with unconventional gas extraction persist.

Hydraulic fracturing, the technique banned in France but behind a recent boom in U.S. gas production, is the most controversial of these new processes and involves pumping liquids and chemicals deep underground at high pressure to release trapped gas deposits.

The IEA acknowledged that producing shale gas was an “intensive industrial process, generally imposing a larger environmental footprint than conventional gas development” and could have major implications for local communities and water resources.

But if the energy industry adopted a set of golden rules, the IEA argued, local populations would better accept the new methods and “allow for a continued global expansion” of gas supplies “with far-reaching consequences for global energy markets.”

The IEA’s proposed rules stress “full transparency” on the part of gas developers and would require a careful choice of drilling sites to reduce above-ground impacts and minimize the risks of earthquakes or water supply contamination.

“Leaks from wells into aquifers can be prevented by high standards of well design, construction and integrity testing,” the IEA insisted while urging governments to create adequate supervisory systems to both monitor the work and reassure developers.

In an optimal scenario where its rules are adopted, the IEA said production of unconventional gas could more than triple to 1.6 trillion cubic meters in 2035, with the U.S. becoming the world’s biggest producer.

The greater availability of gas would have a strong moderating impact on prices and, as a result, global gas demand would rise by more than 50 percent between 2010 and 2035, the IEA said.

Under the golden rule scenario, the share of gas in the global energy mix would reach 25 percent in 2035, and overtake coal to become the second-largest primary energy source after oil.

On the other hand, if the golden rules were ignored, the IEA warned that gas demand would continue to trail coal, with significant consequences for global carbon emissions.