AMERICAN GAS APRIL 2013 32 For energy guru and LNG 17 keynoter DANIEL YERGIN, the history of energy is the history of the world. Here’s how that history is unfolding become clear that this was not something on the fringes, but something that would have major consequences not only for the North American gas market but for the global gas market. AG: The EIA is forecasting that the U.S. will become a net exporter of LNG by 2022. Do you agree? DY: We think it will happen much earlier. The big question is: How big of an ex- porter will the U.S. be? AG: What will determine the answer? DY: Well, it will obviously be deter- mined by global competition, but also by economics and public policy. LNG 17 is taking place right in the middle of a major debate on the scale of U.S. LNG exports. AG: On the subject of public policy, President Obama recently announced his nominees for secretaries of Energy and Environment. What do you think his selections signal to those in the natural gas business? DY: I’ll put it this way: the develop- ment of shale gas started off as a national discussion on energy supplies. But it has turned into a national discussion about jobs and the economy, and I think the Obama administration has generally been supportive of the development of shale gas. We’ve done studies, and our numbers indicate that shale gas and tight oil sup- port 1.7 million jobs in the U.S. and last year generated $62 billion in federal and state revenues. These are big, important numbers at a time when unemployment and the federal budget are such big con- cerns. I think there is broad recognition that this unconventional revolution in oil and gas has made the United States much more competitive. I hear that when I’m in China. I hear that when I’m in Europe. AG: In your books, one of your un- derlying themes is that the history of energy is the history of the world. What’s next on the horizon: renewables? Methane hydrates? Something most of us have never heard of? DY: Shale gas is the biggest energy innova- tion so far of the 21 st century. I say “so far” because I don’t think we’ve ever seen so much emphasis on innovation all across the energy spectrum, on a global scale. I’m sure that there will be other innovations that will surprise us—whether it comes from conventional energy such as methane hydrates or something that almost nobody is thinking about today. What I conclude is that if we look out to 2030, we’ll see the world using a lot more energy but the shares between conventional and alternative will be pretty much the same. The real changes will come in that 2030 to 2050 period in response to all the innovation that’s going on now. AG: And then you’ll have to write another book. DY: Right, another book. u In 1992, Cambridge Energy Research As- sociates Co-Founder Daniel Yergin won the Pulitzer Prize for his book, The Prize: The Epic Quest for Oil, Money, and Power, a history of the oil industry dating back to the early 19 th century. Nearly two decades later, the rapidly changing global energy landscape led him to write yet another book, The Quest: En- ergy, Security, and the Remaking of the Modern World, which has been described as “masterly” and the “one book you must read to understand our economy and our way of life.” Yergin, who is vice chairman of IHS, has also served on President Obama’s seven-mem- ber advisory panel on hydraulic fracturing. In advance of his April 17 keynote ad- dress to LNG 17 attendees, Yergin talked to American Gas about the amazing story of shale gas so far and how he thinks the next few chapters will unfold. American Gas: In 2007, when it was announced that LNG17 would be held in Houston, the U.S. was firmly in the category of LNG importer. Now it seems to be on the cusp of becoming a major exporter. What happened? Daniel Yergin: As we’ve seen again and again throughout history, expectations in the energy industry have been upended by technology, and that’s exactly what has happened here. It took 20 years to reach the point of a breakthrough on shale gas—which really occurred in 2003— and it wasn’t until 2008 that it started to AN UNCONVENTIONAL REVOLUTION PROFILE PHOTOGRAPHY BY BEBETO MATTHEWS/AP PHOTO
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AmericAn GAs april 201332
For energy guru and LNG 17 keynoter
daniel yergin, the history of energy is the history
of the world. Here’s how that history is unfolding
become clear that this was not something on the fringes, but something that would have major consequences not only for the North American gas market but for the global gas market.
AG: The EIA is forecasting that the U.S. will become a net exporter of LNG by 2022. Do you agree?DY: We think it will happen much earlier. The big question is: How big of an ex-porter will the U.S. be?
AG: What will determine the answer?DY: Well, it will obviously be deter-mined by global competition, but also by economics and public policy. LNG 17 is taking place right in the middle of a major debate on the scale of U.S. LNG exports.
AG: On the subject of public policy, President Obama recently announced his nominees for secretaries of Energy and Environment. What do you think his selections signal to those in the natural gas business?DY: I’ll put it this way: the develop-ment of shale gas started off as a national discussion on energy supplies. But it has turned into a national discussion about jobs and the economy, and I think the Obama administration has generally been supportive of the development of shale gas. We’ve done studies, and our numbers indicate that shale gas and tight oil sup-port 1.7 million jobs in the U.S. and last year generated $62 billion in federal and
state revenues. These are big, important numbers at a time when unemployment and the federal budget are such big con-cerns. I think there is broad recognition that this unconventional revolution in oil and gas has made the United States much more competitive. I hear that when I’m in China. I hear that when I’m in Europe.
AG: In your books, one of your un-derlying themes is that the history of energy is the history of the world. What’s next on the horizon: renewables? Methane hydrates? Something most of us have never heard of?DY: Shale gas is the biggest energy innova-tion so far of the 21st century. I say “so far” because I don’t think we’ve ever seen so much emphasis on innovation all across the energy spectrum, on a global scale. I’m sure that there will be other innovations that will surprise us—whether it comes from conventional energy such as methane hydrates or something that almost nobody is thinking about today.
What I conclude is that if we look out to 2030, we’ll see the world using a lot more energy but the shares between conventional and alternative will be pretty much the same. The real changes will come in that 2030 to 2050 period in response to all the innovation that’s going on now.
AG: And then you’ll have to write another book.DY: Right, another book. u
In 1992, Cambridge Energy Research As-sociates Co-Founder Daniel Yergin won the Pulitzer Prize for his book, The Prize: The Epic Quest for Oil, Money, and Power, a history of the oil industry dating back to the early 19th century.
Nearly two decades later, the rapidly changing global energy landscape led him to write yet another book, The Quest: En-ergy, Security, and the Remaking of the Modern World, which has been described as “masterly” and the “one book you must read to understand our economy and our way of life.”
Yergin, who is vice chairman of IHS, has also served on President Obama’s seven-mem-ber advisory panel on hydraulic fracturing.
In advance of his April 17 keynote ad-dress to LNG 17 attendees, Yergin talked to American Gas about the amazing story of shale gas so far and how he thinks the next few chapters will unfold.
American Gas: In 2007, when it was announced that LNG17 would be held in Houston, the U.S. was firmly in the category of LNG importer. Now it seems to be on the cusp of becoming a major exporter. What happened?Daniel Yergin: As we’ve seen again and again throughout history, expectations in the energy industry have been upended by technology, and that’s exactly what has happened here. It took 20 years to reach the point of a breakthrough on shale gas—which really occurred in 2003—and it wasn’t until 2008 that it started to
aN uNcoNveNtioNaL revoLutioN
p r o f i l e
photography by bebeto matthews/ap photo
on the horizon:“i doN’t tHiNk we’ve ever seeN so mucH empHasis oN iNNovatioN aLL across tHe eNerGy spectrum, oN a GLobaL scaLe.”
april 2013 AmericAn GAs 33
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