Dec 10 - 16, 2012

Shale gas is natural gas produced from shale, a type of sedimentary rock. Shale gas has become an increasingly important source of natural gas in the United States over the past decade, and interest has spread to potential gas shales in Canada, Europe, Asia, and Australia.

The outgrowth of shale gas supplies is a blessing to the US economy and a support for potential climate policy. The lower-cost energy is planned to energize greater economic growth over the period to 2050. Under a tight target, enforced by emissions price; the economic gains for United States are even greater.

With the exploration work done in the United States on deep drilling and hydraulic fracturing to draw out hydrocarbons from shale rock, it is now judged that the US has over 1000 trillion cubic feet of recoverable unconventional gas, according to the Wall Street Journal. It has been supposed there may be up to a 100 year supply of natural gas in the United States.

The rapid development of non conventional gas resources, especially shale gas, in China and India-two of the world's quickest-growing economies-justify close watching because of the possible economic and energy security gains that productive development could bring to the two countries.

China and India have already started digging into their significant indigenous shale gas resources. China has determined its companies a target of producing 30 billion cubic meters a year from shale, equivalent to almost half the country's gas consumption in 2008.

Possible gas-bearing shales are said to be in far-flung in China, although as yet undeveloped. In November 2009, US President Barrack Obama agreed to share US gas-shale technology with China, and to encourage US investment in Chinese shale-gas development.

China set up a national shale gas research centre in August 2010. Based on existing reports, China may have 30 trillion cubic meters of shale gas reserves. Till April, 2012, Shell already drilled few wells in Sichuan and find some resources

Companies including Reliance Industries Limited (E&P), RNRL, have shown involvement in exploring for shale gas in India. Reliance Industries paid a reported US$1.7 billion for a 40 percent share in Atlas Energy's leasehold in the Marcellus shale gas play in the eastern US.

During US President Obama's visit to India in November 2010, India and US decided to cooperate in the fields of clean-tech and shale gas.

Recent shale gas discoveries have induced a sharp increase in estimated recoverable natural gas in Canada. The country has a number of prospective shale gas targets in various stages of exploration and exploitation in British Columbia, Alberta, Saskatchewan, Ontario, Quebec, New Brunswick and Nova Scotia.

One major area of exploration in Canada is north of Fort Nelson, in north east British Columbia. Encana and EOG Resources are developing the area known as Horn River due to its high yield shale deposits.

A number of these well sites are serviced by Alberta fracturing companies, many of which, started out as a one person operation with the purchase of a cement truck.

Major gas field have been discovered in Sindh. Italian energy major ENI said it had discovered a major reserve of between 300 billion and 400 billion cubic feet of gas some 350 kilometres north of Karachi in Pakistan.

The discovery was made in the Khirthar Fold Belt region close to the ENI-operated Bhit gas processing facility, the company said in a statement. The company said it had begun talks with Pakistani authorities on creating a joint venture, adding that it would "help to reduce the national gas deficit."

Italian oil group Eni said it had discovered a new onshore gas field in Pakistan with about 8.5-11.5 billion cubic meters of gas in place. A test revealed the gas quality is "excellent", Eni said.

Pakistan has vast shale Gas deposits. Reports of new gas reserves are especially welcome at this critical moment of crisis in Pakistan when it is facing a very grave and uprising energy crisis. The US Energy Information Administration (EIA) puts the estimates even higher at 51 trillion cubic feet. As of 2009, Pakistan stands 17th in the world in terms of total Technically Recoverable Shale Gas Resources.

Pakistan in particular is dependent to a greater extent on natural gas for its energy needs. Demand for natural gas in Pakistan has increased by nearly 10 percent per annum from 2000-01 to 2007-08, reaching around 3,200m cubic feet per day (MMCFD), against the total production of 3,774 MMCFD, according to Pakistani official sources. But, during 2008-2009, the demand for natural gas overstepped the available supply, with production of 4,528 MMCFD gas against demand for 4,731 MMCFD, showing a deficit of 203 MMCFD.

According to the Hagler Bailly report that Pakistan's gas shortage would get much worse in the next twenty years if it did not bring on any alternative sources.

Shale gas offers an optional source for energy-hungered Pakistan. Crude estimates suggest the presence of nearly 33 trillion cubic feet of unconventional gas reserves trapped in rocks, according to an ENI Pakistan report. Another report by Shahab Alam, technical director of Pakistan Petroleum Concessions, puts the figure at 40 trillion cubic feet of tight gas reserves in the country.

To encourage investment in developing domestic shale gas, Pakistan has approved a new exploration policy with improved incentives as compared with its 2009 policy.

Pakistan Petroleum is now inviting fresh bids to auction licenses to explore and develop several blocks in Dera Ismail Khan (KPK), Badin (Sind), Naushero Firoz (Sind) and Jungshahi (Sind).

No dubt that shale does burn much cleaner than coal and oil, the process of extraction of shale gas in Pakistan, or anywhere else, is not without risks, particularly risks to the environment.

In the United States, there have been several reports of ground water contamination from chemicals used to fracture rocks, as well as high levels of methane in water wells. In the lack of stringent regulations and careful supervision, such contamination of ground water could spell catastrophic for human beings and agriculture.

In the context of Pakistan's reliance greatly on natural gas for energy and the raw material that is required for some industrial process for industries such as fertilizer, fiber and plastics, it is vital to follow up on shale gas fields development under fairly stringent environmental rules to reduce risks to the ground water resources.

Government in this critical hour of energy crisis has been urged to explore untapped shale gas reserves. The business community says that there are ample untapped reserves of shale gas particularly available in Sindh and other parts of the country, which should be explored to end the existing energy crisis.

All stakeholders of the pertained areas may be invited to sit together and put an end to the uncertain situation prevailing for the industry, which need an encouragement by addressing energy needs.

The payments for oil import bill is the major factor that has put pressure on weak economy as oil imports constitute about 40 percent of Pakistan's total import bill that is resulting in a huge trade deficit.

With over 50 trillion cubic feet of known shale gas reserves in Sindh alone, Pakistanis can also enjoy the benefits of cheap and abundant source of energy for decades via the shale gas revolution already over in America. Cheap domestic gas can start flowing from Pakistani shale in a couple of years

Pakistan can make an agreement with US (and American pioneers of shale gas like George Mitchell's Devon Energy) to invest and execute on an accelerated schedule. In this context cheap domestic gas can start flowing from Pakistani shale in a couple of years.

Pakistan will tremendously reduce its dependence on foreign sources and save a lot of foreign exchange spent on hydrocarbon imports.

Gas burns a lot cleaner than coal which is also an option given vast amount of it in Thar Desert. World Bank and other International financial institutions are more comfortable to financing shale gas development than coal.

Abundant and cheap domestic gas supplies can help reduce electricity load-shedding which is caused mainly by under-utilization of installed generating capacity for lack of affordable fuel. Thus shale gas can bring a revolution for abundant and Cheap Energy in Pakistan.