European Fracking Bans Open Market for U.S. Gas Exports
By Katarzyna Klimasinska from Bloomberg
Opposition to a drilling technique known as hydraulic fracturing has slowed the development of natural gas in Europe, creating export opportunities for U.S. producers hurt by low prices and a glut of gas at home.
Fracking, as the practice is known, was temporarily suspended in the United Kingdom after it was linked to a series of earthquakes. Bulgaria and France — home of the continent’s largest estimated reserve — outlawed it over environmental concerns. Some other countries are poised to impose moratoriums on the process, in which water, sand and chemicals are pumped underground to free gas trapped in rock.
This opposition, along with a projected growth in demand driven in part by Germany’s plan to phase out nuclear power, has created opportunities for U.S. gas producers such as Exxon Mobil Corp. (XOM) Imports to the European Union are projected to grow 74 percent by 2035 as Italy, Poland and Lithuania build terminals to receive tankers carrying gas in liquefied form.
“Europe’s an obvious market for such U.S. LNG exports,”said Daniel Yergin, an energy analyst and Pulitzer Prize-winning author of books chronicling development of the global energy industry.
Europe has an estimated 639 trillion cubic feet of shale gas resources, according to the U.S. Energy Information Administration. That is more than four times the reserves of the Marcellus Shale formation from New York to Tennessee that has fueled much of the fracking boom in the U.S.
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