Remember The Talk About A Global Shale Revolution? Don't Hold Your Breath. Jeff Reed

http://oilpro.com/post/11504/remember-talk-global-shale-revolution-dont-hold-your-breath

Paralleling the collapse in the oil price has been the collapse in hopes that the a global shale revolution will occur anytime in the near or mid-term future. For the last five years or so, and after billions of investment, some of the leading global oil companies are beginning to scale back their efforts to replicate the NAM shale boom on a world scale.

The Wall Street Journal reported Thursday that majors such as ExxonMobil, Chevron and Shell have ceased nearly all efforts to get unconventional exploration underway in Europe, Russia and China. In addition to oil prices below what it costs to produce a barrel of shale oil, sanctions against Russia, a fracing ban in France, a fracing moratorium in Germany and an unfavorable regulatory regime and poor initial results in Poland, are among the principal reasons the paper cites for the dimming of global shale hopes.

In February, Chevron stalled its last European fracing operations when it exited Romania. In its 4Q14 earnings conference call, Shell said it is reducing global shale spending by 30% in areas including Ukraine, Turkey and Argentina. Meanwhile, ExxonMobil has exited Poland and Hungary, and its fracing operations in Germany have been put on hold.

Consequently, only China, Argentina and Canada are currently engaged in commercial shale production outside of the US. And, according to the EIA, NAM contains less than 10% of the world's estimated shale reserves. According to the agency, Europe (inclusive of Russia) and China alone hold nearly triple the reserves of the US.