Shale Gas Production so now what?
The enormous potential for natural gas production is the essence of the shale gas revolution. Many people are still spending much of their time quantifying it. For those in the commodity trading, planning, or business development space, I think it’s time to move on and examine the opportunities. Shale gas production will not be small. Perhaps it could be medium with potential regulations limiting the development. It may be extra-large if knowledge is increased and the players involved act appropriately. The next important question is where will it all go? As with any product that is introduced, you need to do some market assessment. I can with some certainty pronounce that the bulk of the new gas supply will go to the power market.
Following that premise, the next question will be how it will go to the power sector? The answer to this will vary. As a producer you need to know your customer and how exactly best to market to this new sector. Given my vast oil & gas experience along with my power utility experience I can be that bridge for you to understand what is involved in this transition. Letting nature/market takes its course for you will produce a very rocky outcome. Approaching the transition in a more strategic approach will allow you to unlock more value and avoid significant on-hands learning moments.
Inversely, as a power/utility company, moving to gas will require much consideration as the dynamic of the gas industry is much different than the coal industry. The lingo and the business strategies are almost polar opposites in some cases. The power and gas industry are currently not aligned in the advocacy position of energy policy (or lack of). This will need to change if this transition will be smooth and productive.
At AEC we can act as the bridge for you. We can pull the two sides together to produce a win-win situation. Please call us to learn, reaffirm, and give you a unique perspective on the situation. 614-356-0484 email [email protected]
