What Energy Solutions Does Daniel Yergin See in Shale and R&D?

TL;DR

Daniel Yergin argues that expanding shale development and sustained energy R&D could reshape the energy picture, although the size of shale resources remains unknown until drilling occurs. Shale gas technology developed for about 20 years before its pieces came together in 2003, while China, India, and the United States are contributing to a globalization of innovation. Read on for the specific technologies, regions, and investment priorities discussed.

Transcript

hi I'm here with Daniel Yergin who's probably the most respected expert on energy markets he's got a fantastic new book out called the quest I'm talking about a topic of great importance where will we get energy what does it mean environmentally what does it mean about competition between different countries and so a very hot topic now one thing I'... Read More

Key Insights

• 🔑 The shale gas phenomena has dramatically increased in the United States, changing the energy picture and psychology of energy.

Questions & Answers

Q: How does Daniel Yergin understand emerging energy solutions?

Yergin emphasizes rapidly improving shale drilling and exploration technology alongside greater, more consistent investment in energy R&D. He also sees promise in the globalization of innovation, with the United States, China, India, and others participating.

Q: Why has shale gas changed the United States' energy outlook?

Shale gas numbers increased dramatically within a few years, changing both the United States' energy picture and the psychology surrounding energy. However, the total resource remains uncertain because formations must be drilled and better understood.

Q: Could shale resources be four or 10 times larger than current proven resources?

Yergin says that such growth is possible, but the upper bound is not yet known. As his drilling adage explains, certainty comes only after companies drill into the rocks and examine the formations.

Q: How did technology enable the shale gas boom?

Shale gas was under development for about 20 years, with the pieces coming together in 2003. By 2008, the world recognized that something significant was happening, and technology continued advancing in drilling and in addressing environmental issues.

Q: Which shale and tight-oil regions does Daniel Yergin identify?

Yergin names Ohio's Utica Shale as a major emerging frontier where drilling was just beginning. He also identifies North Dakota, South Texas's Eagle Ford, Colorado, and potentially California as important areas for tight oil.

Q: What does North Dakota demonstrate about applying shale technology to oil?

Yergin says North Dakota became the third-largest oil-producing state in the United States. The discussion also cites roughly 3,000 rail cars per week carrying oil, illustrating the enormous volume involved.

Q: Why should government energy R&D funding be higher and more consistent?

Yergin says volatile spending makes it difficult for people to commit to projects, build careers, and remain in the field. A higher and more consistent R&D budget would provide predictability and may be the most important government contribution to energy.

Q: Why is Daniel Yergin optimistic about global energy innovation?

Yergin points to a globalization of innovation extending beyond the United States and Europe to China and India. China stands out because its enormous energy needs require a greater effort to sustain economic growth, while broader participation in innovation can benefit everyone.

Summary & Key Takeaways

• Shale gas has transformed the energy picture and psychology of energy, with its potential still largely unknown.

• The development of shale gas has been driven by advancements in drilling and exploration technology, as well as efforts to address environmental concerns.

• China is making significant efforts in energy research and development, while the United States needs to prioritize and invest consistently in R&D to have a greater impact.