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  • bluecheese4u bluecheese4u Jul 31, 2013 7:33 PM Flag

    DOE official: Chinese natural gas could 'wreak havoc' on markets

    DOE official: Chinese natural gas could 'wreak havoc' on markets

    Zack Colman - 07/25/13 12:03 PM ET

    A senior Energy Department official said Thursday that China has the potential to “wreak havoc” on global natural gas markets if it develops its shale resources.

    DOE counsel Melanie Kenderdine, who made the comments at a Washington, D.C., event hosted by think tank the Bipartisan Policy Center, said that possibility was still 10 or 15 years away. She viewed it as a positive development from a geopolitical perspective, as it could wrest control of markets from Russia.

    For China, the question is whether the nation can economically produce shale gas. Its technology isn’t up to par with that of the United States, and its deposits are located far from water sources.

    The drilling method that has driven the U.S. boom — hydraulic fracturing, or fracking — uses large amounts of water, making it a necessary input in shale gas recovery.

    The practice involves injecting a cocktail of water, sand and chemicals into tight-rock formations to tap hard to reach hydrocarbons buried deep underground.

    Kenderdine said the vast shale gas resources discovered during the recent U.S. energy surge already have affected global energy markets.

    Backing out of import plans already has exerted downward pressure on prices, Kenderdine said.

    And shale finds in Africa, Eastern Europe, China and elsewhere could loosen the grip Russia has on the global natural gas trade, helping to destabilize a government that’s been cool to the U.S. and giving allies more options for trading partners.

    “That will affect Russia,” Kenderdine said plainly.

    The changing geopolitics of natural gas offered “an enormous opportunity for the world,” Kenderdine said.

    The remarks also could point to how President Obama and his Energy Secretary Ernest Moniz are leaning on natural gas in the fight against global climate change.

    Both have promoted natural gas as a way to curb greenhouse gas emissions, as natura

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