This post is one of my series of tech talks, describing some of the ways in which fossil fuels are produced. In the current part of the series we are focusing a little more on the procedures that are being used to recover natural gas from formations such as the Barnett, Fayetteville, Marcellus, Haynesville and Woodford shales. In this particular post I am going to concentrate more on the benefits of horizontal drilling through these shale reservoirs, rather than using the more conventional vertical wells that were used historically. This, and the next three posts in the series are likely to be a bit more technically dense than earlier posts, but I am trying to illustrate some of the problems of production, and some of the gains that technology is bringing to help solve some of them. And while the reason for the horizontal wells can be simplified in this graph from Chris McGill, there are a lot of other things that have to be considered in deciding whether or not the horizontal well is going to be worth developing.

Comparative production from a vertical and horizontal natural gas well (Chris McGill).
Notice the gain in production, but much shorter life of the horizontal well.

Gazprom says Ukraine blocking resumed gas flows

MOSCOW, Jan 13 (Reuters) - Russian gas monopoly Gazprom (GAZP.MM) said Ukraine was blocking gas flows to Europe across Ukrainian territory on Tuesday. "We believed yesterday that the door for Russian gas was open but again it's been blocked by the Ukrainians," Gazprom export chief Alexander Medvedev [said]

I recently looked through news articles to see which energy sectors were being affected by the credit crisis. I was amazed at how widespread and how devastating the impact is.

There are really two closely related problems. One is reduced access to credit, making new borrowing difficult for nearly every business that requires debt. Prices for all commodities have been dropping as well. At least part of the reason for this price decline is the lack of availability of credit—many of the less credit-worth buyers drop out of the market. This leaves fewer buyers and almost the same number of sellers, so the price drops.

This was posted in May 2007 and is worth reposting today given the new context of tense relations with Russia and worries/suspicion/empty talk about "energy weapons." The original post is built as a discussion an an Economist article about Russian gas (A bear at the throat) published in April 2007. Back then, "it took legitimate (if often poorly informed) worries about Russia's sometimes blustering behavior on the energy markets to peddle the usual insane crap that market liberalisation is the only solution to promote energy security." Today, the focus seems to be more on the geopolitical threat the Russia represents, but the conclusion is still, of course, about the incompetence and failure of continental Europe - this time not to liberalize, but rather to 'stand up' to Russia's bullying. Below, the original post, with some additional comments written today in italics and [between brackets]).

[Last year] I spoke at a debate on Gazprom at IFRI, a French think tank. That conference was organised after the publication of two quite different articles about Gazprom:

Gazprom as a Predictable Partner. Another Reading of the Russian-Ukrainian and Russian-Belarusian Energy Crises by Jérôme Guillet
Gazprom, the Fastest Way to Energy Suicide by Christophe-Alexandre Paillard

The titles give a hint that the papers start from pretty different positions - as you can see in the executive summaries of each that I am posting below, [but they in fact reach fairly similar conclusions, which are still relevant today]