The Conversation: A “frack” in the bridge from coal to gas

With the hype surrounding the US gas-boom, it’s something of a worrying and cautionary note to read in the Financial Times outgoing Shell CEO Peter Voser quoted as saying his “huge bet on US shale was a big regret of his time as chief executive of the company”.

With a purported $24 billion invested in so-called unconventional oil and gas in North America, the FT reports Shell has recently taken a “$2.1 billion impairment against its assets” with Voser quoted as saying “Unconventionals did not exactly play out as planned”.

This is something of a mea culpa for the fossil fuel heavyweight. Just over 12 months ago Voser was championing the “natural gas revolution” as the most significant energy development in decades, citing the dramatic impact of new reserves of tight gas, shale gas and coal seam gas in the United States.

It may well prove to be, but Voser’s comments suggest some cracks are appearing in the bridge to the new energy future promised by the gas boom.

Part of the problem appears to be that Shell entered the American shale-gas game late, around 2010, paying over the top just when the supply boom was pushing prices to historic lows.   MORE