World news – weekly shale update 12 -18 January 2015

Selected international shale gas exploration events in the week of 12 -18 January 2015


The Algerian corporation Sonatrach plans to allocate USD 70 billion to the development of the shale gas sector by 2025. The announcement was made shortly after successful test drilling in the region of Salah in the Sahara Desert. In the future, Algeria is to produce up to 20 Bcm of natural gas yearly from 200 planned wells. However, objections of the local communities from the villages located near the planned wells in the South of Algeria are likely to frustrate these plans. The protests have lasted for several weeks and are still getting stronger. They include demonstrations against shale gas extraction, peaceful marches of university and high school students and shutting down the local shops. According to estimates, about 2000 people joined the protest.


The Jereh Corporation completed its shale gas liquefaction facility at Junlian (Sichuan Province), the first one of this kind in China. Initially, the facility will produce up to 70,000 cubic metres of LNG per day. The planned output is to increase to 300,000 cubic metres – the news service announced. Shale gas reserves of the Sichuan Province are counted among the largest in China, the news service reminds.

The Baltic Countries

Three Baltic countries (Lithuania, Latvia and Estonia) signed a declaration on energy supply security. The purpose of the understanding is to enable joint operation of the Lithuanian gas terminal in Klaipeda and of the huge gas storage facility in Latvia. According to estimates, the terminal will satisfy 90% of the annual gas requirements of the three countries. Thanks to the floating terminal, the Baltic countries will be able to achieve independence from gas imports from Russia.


The terms of conditions of the new call for shale gas exploration tenders will be ready by the end of January. Tendering documents will be based on the previous call, but changes in legislation and geopolitical situation of Lithuania will be taken into account, said Daiva Matonienie, Lithuanian Vice-minister for Environment. The new call for tenders may be announced in spring, said Jonas Satkūnas, Lithuanian Geological Survey Director, and added that the representatives of the Chinese Sinopec Company, who have visited Lithuania in the summer of 2014, have expressed a high interest in shale gas exploration in that country. Nevertheless, only formal Chinese tender may substantiate that declaration.


In its monthly report, OPEC made an assessment of the international oil market, noting that prices are falling due to oversupply of that commodity. Oil prices dropped to their lowest level in six years and the demand for oil hit its ten-year low. According to the forecast for 2015, international oil demand is to fall to 28.78 Mbbl per day, i.e. 1 Mbbl less than today.

United Kingdom

The British Geological Survey is to deliver an independent detailed study on the effect of shale gas exploration/production on the environment. Hydraulic fracturing operations in two Lancashire wells (Northwest England) will be monitored. Exploration operations are conducted by the Cuadrilla Resources Company.


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