Exxon eyes Shale Gas potential in Europe

Oil major ExxonMobil Corp. sees a lot of potential for unconventional types of gas such as shale gas in Europe, and plans to focus first testing in Germany and Poland, its head of gas marketing in Europe said Tuesday.

Industrial demand for gas in Europe is picking up slowly, while there are good prospects for improving levels of commercial and residential demand in 2010 after a boost at the start of the year due to cold weather, Exxon’s Richard Guerrant said in an interview with Reuters.

As imports are expected to make up about 70 per cent of Europe’s gas supplies by 2030, Guerrant said incentives were growing to tap unconventional gas resources, though they would take several years to develop on the continent.

“Looking at shale and other forms of unconventional gas, we see a lot of that type of geology throughout Europe,” Guerrant said at an industry conference in Amsterdam, adding that Germany and Poland were a focus for testing resources at the moment.

“We are looking at both shale and other areas, we are looking at all the potential unconventional gas in Europe,” he said, adding densely populated areas were also potential sites, pointing to existing projects in U.S. metropolitan areas.

Gas production from shale formations, which involves fracture drilling with chemicals to release tiny pockets of trapped gas, has rocketed in the U.S. and has helped flip the global gas market from under supply to over supply.

Apart from shale, Guerrant said Exxon was also looking into coal bed methane and tight gas resources in Europe.

Reported by Catherine Hornby in Amsterdam for Reuters

Source: The Calgary Herald