It is quite likely that shale gas is being oversold as a revolutionary energy source, based on industry data and internal emails uncovered by muckraking New York Times journalist Ian Urbina.
In the e-mails, energy executives, industry lawyers, state geologists and market analysts voice skepticism about lofty forecasts and question whether companies are intentionally, and even illegally, overstating the productivity of their wells and the size of their reserves. Many of these e-mails also suggest a view that is in stark contrast to more bullish public comments made by the industry, in much the same way that insiders have raised doubts about previous financial bubbles….
Production data, provided by companies to state regulators and reviewed by The Times, show that many wells are not performing as the industry expected. In three major shale formations — the Barnett in Texas, the Haynesville in East Texas and Louisiana and the Fayetteville, across Arkansas — less than 20 percent of the area heralded by companies as productive is emerging as likely to be profitable under current market conditions, according to the data and industry analysts.
…less than 10 percent of the wells had recouped their estimated costs by the time they were seven years old….
I have read of annual production decline rates of up to 80% – meaning that well after well must be drilled just to keep production flat. With many states in the South being hit by their worst drought on record, can we really afford to use the massive amounts of water required for hydraulic fracturing (often over a million gallons per well)?