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Interview: Energy Investor Bill Powers Discusses Looming Shale Gas Bubble

Cross-Posted from DeSmogBlog

Cold Hungry and in the Dark cover

Bill Powers latest book looks at the mythology of the natural gas industry.

On Sat., April 27, I met up with energy investor Bill Powers at Prairie Moon Restaurant in Evanston, IL for a mid-afternoon lunch to discuss his forthcoming book set to hit bookstores on June 18.

The book’s title – Cold, Hungry and in the Dark: Exploding the Natural Gas Supply Myth – pokes fun at the statement made by former Chesapeake Energy CEO Aubrey McClendon at the 2011 Shale Gas Insight conference in Philadelphia, PA.

“What a glorious vision of the future: It’s cold, it’s dark and we’re all hungry,” Powers said in response to the fact that there were activists outside of the city’s convention center. “I have no interest in turning the clock back to the dark ages like our opponents do.”

What Powers unpacks in his book, though, is that McClendon and his fellow “shale promoters,” as he puts it in his book, aren’t quite as “visionary” as they would lead us all to believe.

Indeed, the well production data that Powers picked through on a state-by-state basis demonstrates a “drilling treadmill.” That means each time an area is fracked, after the frackers find the “sweet spot,” that area yields diminishing returns on gas production on a monthly and annual basis.

It’s an argument regular readers of DeSmogBlog are familiar with because of our recent coverage of the Post Carbon Institute‘s “Drill Baby, Drill” report by J. David Hughes.

Powers posits this could lead to a domestic gas crisis akin to the one faced in the 1970’s.

We discuss these issues and far more in the interview below.

SH: Tell me more about the premise of your book, why you wrote it, and what you think some of the biggest findings were from your book.

BP: What I really take a look at and show is that shale gas, while it’s an important resource, it’s importance has been vastly over-stated. We do not have a 100-year supply of shale gas.

The increasing demand, which has been brought about by the low prices of the last few years, is going to lead to another 1970’s-style gas crisis. That will happen sometime between 2013 and 2015. We are seeing gas – while there’s been a lot of promotion of the 100-year supply myth – the facts simply just do not support it. That’s the premise of the book. [cont’d.]

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