De Silva, PNK;
Simons, SJR;
Stevens, P;
(2016)
Economic impact analysis of natural gas development and the policy implications.
Energy Policy
, 88
pp. 639-651.
10.1016/j.enpol.2015.09.006.
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Abstract
In the US, the shale gas revolution ensured that the development costs of unconventional natural gas plummeted to the levels of $2-$3/Mcf. This success has motivated the development of shale gas in other regions, including Australia and Europe. This study, focussing primarily on aspects of economic impact analysis, estimates the development costs of shale gas extraction in both Australia and Europe, based on both direct and fiscal costs, and also suggests policy initiatives. The increasing liquefied natural gas (LNG) developments in Australia are already straining domestic gas supplies. Hence, the development of more natural gas resources has been given a high priority. However, a majority of the Australian shale resources is non-marine in origin and significantly different to the marine-type shales in the US. In addition, the challenges of high development costs and the lack of infrastructure, service capacity and effective government policy are inhibiting shale gas development. Increasing the attractiveness of low risk investment by new, local, developers is critical for Australian shale gas success, which will simultaneously increase domestic gas security. In the European context, unconventional gas development will be challenged by direct, rather than fiscal costs. High direct costs will translate into average overall gas development costs over $13/Mcf, which is well over the existing market price.
| Type: | Article |
|---|---|
| Title: | Economic impact analysis of natural gas development and the policy implications |
| Open access status: | An open access version is available from UCL Discovery |
| DOI: | 10.1016/j.enpol.2015.09.006 |
| Publisher version: | http://dx.doi.org/10.1016/j.enpol.2015.09.006 |
| Language: | English |
| Additional information: | Copyright © 2015 Elsevier Ltd. This manuscript version is made available under a Creative Commons Attribution Non-commercial Non-derivative 4.0 International license (CC BY-NC-ND 4.0). This license allows you to share, copy, distribute and transmit the work for personal and non-commercial use providing author and publisher attribution is clearly stated. Further details about CC BY licenses are available at http://creativecommons.org/ licenses/by/4.0. Access may be initially restricted by the publisher. |
| Keywords: | Unconventional gas, Development costs, Shale gas, LNG |
| UCL classification: | UCL UCL > Provost and Vice Provost Offices > UCL BEAMS UCL > Provost and Vice Provost Offices > UCL BEAMS > Faculty of Engineering Science |
| URI: | https://discovery.ucl.ac.uk/id/eprint/1474161 |
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