For those following onshore activity in North America, it is clear that in recent months, shale gas has dominated the news. The shale gas boom, colloquially called the “shale gale,” is not a storm that will be confined to the US and Canada for long.

Many have assumed that Europe would be the next shale gas market to develop, but in fact, Asia might well be the next continent to be swept by the storm, with China being the first to make serious domestic investment. China, which is investing heavily in a range of energy sources, is working desperately to meet its growing domestic demand, which could be 3.5 times greater in 2030 than it is today.

The subject of gas and gas markets took center stage at the opening general session of the Society of Petroleum Engineers (SPE) Annual Technical Conference and Exhibition (ATCE) meeting held Sept. 20 to 22 in Florence, Italy. Andrew Gould, CEO, Schlumberger, moderated the panel discussion titled, “Gas Market Variables in the Global Energy Equation.”

Despite current limitations to shale gas development outside North America, Gould said, “Natural gas is rapidly becoming a transition fuel and possibly the fuel of the future.”

Before gas can move into a role as a transition fuel, however, there are several hurdles that must be overcome. One of the greatest of these is public perception.

Michael Stoppard, managing director of IHS CERA, explained that although there are technical challenges to developing gas reserves, public opinion could be a bigger issue. “The challenge for the natural gas industry is not just a technical one,” he said.

Natural gas is abundant, clean, safe, cost-effective, and has a proven track record for delivery, Stoppard said, but although it is a competitive fuel, that is something that is not widely understood outside the industry. Because of that fact, he said, policy could pose challenges to development.

One area of the world where policy will not be an obstacle is China.

Panelist Yan Cunzhang, president of PetroChina Co., said gas is becoming increasingly important to his country. “Since 2000, China has supplied long-term natural gas permits with many countries,” Yan said. Now the country is focusing on developing its domestic reserves, and that includes shale gas.

“Shale gas has been the hottest topic of the energy industry in recent years in the world,” Yan said. Today, it is a hot topic in China, where the estimated potential for shale gas is greater than that of conventional gas.

“China has abundant natural gas resources,” he said.

According to Yan, sandstone gas, shale gas, and coalbed methane coexist vertically in many areas of China, which provide favorable conditions for integrated E&P despite the technical challenges of lower permeability and smaller and deeper reservoirs.

Significant effort will be needed for China to catch up to North America, Yan said, but he is optimistic about the future.

“Although we are at the very beginning of shale gas business,” Yan said, “it will remain a priority for China.”

With interest in gas development spreading across the globe, it might be said that natural gas – formerly the inconvenient byproduct of oil production – truly has come of age.

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