NGFE Reports: Shell goes unconventional in Europe

Speaking at the recent Global Shale Gas Summit, Glynn Ellis, Manager, New Business from Shell’s Global Exploration division emphasized the large role that unconventionals are playing in Shell’s reserves replacement strategy.

Shell has strong shale gas positions in North America, taken initiatives for unconventional resources in some high-risk areas in Columbia and Brazil, was an early entrant in South Africa's Karoo Basin and of course, is active in Europe.

“In Europe we have what we believe is a reasonable position in Sweden, we’re partnered with Exxon in Germany, and have a legacy position in Ukraine which we’re trying to progress – these plays are all high risk,” he added.

Diversification, he said, was key.

“They will not all be successful,” explained Ellis, “but we’re confident that the exposures that we have are fundamental to moving forward, helping us decide whether we should stay dependent upon their success.

Not all shales contain gas and not all gas-containing shales are profitable. Engineering and science may eventually make those plays commercial.”

He said Shell was aggressively trying to grow its position in North America, where its plays were progressing through appraisal to see whether or not they’d be economic. Through an aggressive acquisition strategy in the last few years, Ellis reported that Shell had spent over US$ 14 billion there.

Ellis added, “We’re finding as we’re going overseas, applying the science isn’t as easy as we’d like. Applying our North American strategies may or may not work, like here in Poland,” where he said exploration risk in the subsurface was real.

“What’s exciting is the level of competitor activity here in Poland. We welcome the level of competition and partnering here in Poland and Europe as well.”

Mr. Ellis was confident that industry could help meet the supply chain challenges present in a developing shale gas market like Poland’s. He said there was a need for transparency in terms of market access, adding that up-and-coming technology would help the industry move forward.

“We’ve just finished our third well in Sweden and the community engagement has been positive,” he reported. “Operating in a sustainable way and with the support of the community is achievable.”

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