June 10th, 2012
07:15 AM ET

Zakaria: The game-changer in the geopolitics of energy

By Fareed Zakaria

Last year, the world's energy watchdog published a report which asked an important question: "Are we entering a golden age of gas?"

So I was struck when I saw the International Energy Agency's 2012 report. Gone is the question mark.

Instead it says, simply: "Golden rules for a golden age of gas."

And the starting point of that golden age is right here in America.

It's becoming increasingly clear that the shale gas revolution is a game-changer not just for the energy industry, not just for the U.S. — but for geopolitics.

The technology behind shale gas production, where shale rock is blasted with a mixture of water, sand, and chemicals, is only two decades old. The process is called fracking.

Related: Fracking — What is it?

And in a short time, its success has led to the drilling of 20,000 wells in America, the creation of hundreds of thousands of jobs, and a guaranteed supply of gas for perhaps 100 years. The International Energy Agency says global gas production will rise 50% by the year 2035; two-thirds of that growth will come from unconventional sources like shale — a market the U.S. completely dominates.

We've become the world's lowest-cost producer of natural gas at a cost of $2 per thousand cubic feet; compare that with many European countries which have to pay seven times as much to Russia.

It's increasingly possible to use liquified natural gas as a substitute for oil as a transportation fuel, so the effects go beyond generating electricity. General Motors is planning to produce cars that can take natural gas or oil in their fuel tanks.

Aside from the advantages to America, shale gas has the potential to change the geopolitics of energy.

So far, gas has been supplied by a handful of regimes — Russia, Iran, Venezuela — many of them nasty and illegitimate, thriving on global instability, which actually helps their bottom line since instability equals higher oil and gas prices.

In the next 20 years, much of this energy could come from stable, democratic countries like the United States, Canada, Australia, Poland, France and Israel. That would be good for the free world, bad for the rogues and good for global stability. China has huge shale reserves and, even though it is not democratic, it is a country that seeks stability, not instability.

One problem — there's a significant lobby against shale gas and the way it's produced.

Fracking consumes a lot of water.

Shale production also creates large quantities of methane, a greenhouse gas. Sometimes methane pours out of faucets in areas near shale gas production centers, as you can see in this video. Critics also claim fracking can trigger minor earthquakes.

So what do we do?

The good news is these risks are manageable, as the IEA's new report points out. And it has a list of "Golden Rules" to follow — from safety measures to reducing emissions to engaging with local communities.

The IEA estimates these measures would add just 7% to the cost of the average shale gas well.

Many of the riskiest practices are employed by a small number of the lowest-cost producers, a situation that calls for sensible regulation.

Let's figure out how to make fracking cleaner and safer. We can regulate the process with good, simple rules. The benefits are immense and the problems manageable.

Related stories on GPS:
Assessing American-made energy

Interactive: Fracking — What is it?

Zakaria: How will we fuel the future?


soundoff (326 Responses)
  1. John

    Airplanes are a complete failure of technology- they are a complete waste of natural resources and will go extinct just like the NASA program.

    June 12, 2012 at 4:56 pm |
    • Brandon

      This is about the stupidest post I've ever seen.

      June 12, 2012 at 6:55 pm |
    • johnbishopbarthalamule

      Air planes a complete failure? What are you smoking?

      June 12, 2012 at 9:23 pm |
    • Rick

      Yeh and don't forget about phones... What a dumb invention! That will fade too right John?

      June 13, 2012 at 9:52 am |
    • XYZ

      John is right. The automobile is also a fad. It will never replace the horse

      June 13, 2012 at 7:21 pm |
  2. old golfer

    This isn't correct at all. I worked in the oil field and we were fracking wells in the late 50's in the Rangely, Colorado oil field. I know, because I was working on a well servicing rig at the time and we helped to hook up the pump trucks. No, this isn't new technology at all. Maybe some of the chemicals, but sand was used then as a propping agent like today.

    June 12, 2012 at 5:31 pm |
  3. jon

    Boy liberals hate it when we produce our own gas, they would rather kiss Islamo-butts

    June 12, 2012 at 5:34 pm |
    • joep199

      We hate it more when people generalize. I'm not opposed to extracting natural gas at all, even if my social politics are liberal.

      June 12, 2012 at 10:38 pm |
  4. rvwrb

    A few inaccuracies: Fracking was first done in the 1860's with hydraulic fracking taking place initially in the 1940's.

    While the process uses water, it does not CONSUME water as water is used to create fluid and it is the sand that remains in place to keep the fractures open allowing for the oil or gas to escape from the host rock.

    All the concerns about the environmental effect are rally a lot to do about very little. Society as a whole can benefit more from allowing this type of production than not allowing it to occur because of some minor issues which for the most part are not related to the process itself but rather to the subsequent production process which can be fixed.

    June 12, 2012 at 5:52 pm |
  5. rvwrb

    As a subsequent post, a lot of the shale fracking done in North America is done at substantial depths (100's to 1000's of yards below the surface)which precludes contaminating ground water (0 to 300 feet below surface).

    Yes natural gas can be converted to synthetic oil and low sulphur diesel, albeit at a cost; note to medschool kid: stick to medicine or other things you "might" know about 🙂

    People should check out http://www.bloomenergy.com/ to see what can be achieved through the use of natural gas.

    The water used in fracturing is returned to the surface and reused or treated and returned to the environment. In many cases water is extracted from a deep aquifer which invariable can be salt which is not used from human consumption

    Gas fracking refers to a recent technology that uses a gel in place of water and sand. For the most part, the vast majority of fracking operations for both oil and natural gas employ a water sand slurry with chemicals needed to treat the rock containing the hydrocarbons.

    June 12, 2012 at 6:08 pm |
    • medschoolkid

      I am admittedly no expert in the field. But I would assume it is much cheaper to convert/manufacture an engine to run on natural gas than to convert natural gas into diesel or gasoline. I know people that have switched over their jeeps for around $1500 to $2000. Thank you for dispelling some of these innacuracies about fracking. I am in an active shale area and the only problem I have seen is improperly stored wastewater contaminating the some wells.

      June 12, 2012 at 6:20 pm |
  6. Steve

    Fracking has been occurring here in Colorado for several years. The problem is that the frackers have to find a way to make it a cleaner process and not polute ground water. I think thats doable. The bigger problem is the imminent domain issues that have been popping up here that have forced families to accept drilling on their property. That.....appears to be the larger problem.

    June 12, 2012 at 6:42 pm |
    • Steve

      BTW, I thought it would be a cold day in h e l l when I agreed with anything Fareed says. Im amazed to admit that I agree with him on this one. My world is upside down. I doubt it will happen again.

      June 12, 2012 at 6:45 pm |
  7. mark longhurst

    most of the psots are concerned about the fuel itself-who cares how cheap it is if it destroys underground water and substrate, produces poisonous gases and destabilises the rock base. Because it is fuel, the govs all over the world have ignored the issues and hope this will save their rrses. I fear that the long term effects of this will impact the next generations , so as usual the world will ignore it until its too late–BTW, it may be the lesser of the evil if the yanks are trying to destroy the artic circle for oil.

    June 12, 2012 at 7:08 pm |
  8. butch

    in a hundred years if we're still burning fossil fuels we fail.

    June 12, 2012 at 9:32 pm |
  9. KMB

    Many scientist are concerned with the environmental dangers of fracking. There is the danger of contaminating the ground water.

    The oil industry has a history of factoring in the costs of paying potential legal claims instead of creating safer equipment. If they were held to the same standards as the airline industry we wouldn't have so many oil related disasters. Instead the oil industry invests in lawyers and the political elections of judges that support their causes.
    It's much cheaper and increases their profit margins.

    Many people believe that water will be the next scarce natural resource. Once a water table is contaminated by fracking the entire area will be uninhabitable.

    The oil industry is spending a lot of money convincing the public that this is green energy. It is far from it.

    June 12, 2012 at 10:00 pm |
  10. WDinDallas

    Fracking A! More Gas!

    June 12, 2012 at 10:27 pm |
  11. R P Walker

    Fareed's opinion on natural gas betrays a weakness common among all who do not live right next to the drill rigs and the production pads. The process is hugely damaging to everything the industry comes into contact with...air, water, dirt, flora, and fauna. The gas ads on TV are frustratingly dishonest by omission. He is correct that the problems can be corrected BUT the single biggest hurdle is the companies themselves. They will NOT do so in a serious way until forced. But they are crafty. They gain the support and then control over all level of politicians, pour large sums into TV ads proclaiming "responsibility" in their operations which con the public, and stonewall credible science with "Bush Science" to blunt any threat to their doing business as usual. I know because I have just wrapped up 10 years of field science and challenge to the industry over their pollution of the air in my county in Wyoming but have been successfully marginalized by local, state, and federal land and environment managers who have no intention of complying with the purpose of NEPA.

    June 12, 2012 at 10:33 pm |
    • medschoolkid

      I do agree that the companies will have to work a little harder to clean up certain aspects of the process. But I don't think it is nearly as damaging to the environment as you think it is. I too have been around wells and drilling operations in my area. Growing up I hunted deer near well sites and after they are done drilling the wildlife quickly returns. The gas companies have to maintain the well pads so that the natural flora doesn't overtake it. What kind of air pollution did you encounter? Yes there may be some air pollution during the drilling process but once the well is producing I can't imagine it being that polluting.

      June 12, 2012 at 11:09 pm |
  12. peter

    Who is this Zakaria the Seer of the Universe? Come on he has answer for everything happening in the world.

    June 13, 2012 at 1:52 am |
    • Kenser

      Zakaria is a sort of medical symptom. Currently it cannot be treated by medication yet.

      June 13, 2012 at 2:34 pm |
    • Jefferson_Lives

      Sure he can answer it....they are trying to create world government 😛

      June 14, 2012 at 1:29 am |
  13. Brandon

    Someone's article conveniently forgot to mention that it contaminates ground water on a large scale.

    June 13, 2012 at 3:00 am |
  14. John Tighe

    What's really most important?
    Clean, safe water?
    or cheap natural gas?

    June 13, 2012 at 6:56 am |
  15. Ed

    I constantly read that we don't have the infrastructure to support natural gas refueling for automobiles. That is not true. The natural gas infrastructure in the U.S. is huge! I have a natural gas pipeline to my house, as many Americans do. It's not the right pressure, but it's there. There is no natiowide pipeline for gasoline. The EXISTING natural gas infrastructure can be used to PIPE natural gas to filling stations all over the country for negligible cost. The only cost would be to set up pressure tanks and pumps at filling stations. Come on people. Stop making excuses for not using natural gas as an automotive fuel. It is MUCH cleaner and cheaper. There's a nationwide infrastructure to support it without trucking it around. To me, this is a no brainer.

    June 13, 2012 at 9:11 am |
  16. Ed

    A couple more points.

    1) Energy is the ultimate commodity. There will always be INSATIABLE demand for it. It is better than gold. Energy wins wars, drives economies, makes millions of people rich. It is the ultimate source of power.

    2) Every week I contribute $100 to the gasoline empire. That's $5200 per year, just from me. I am enriching the lives Arabs and other foriegners that don't deserve my hard earned money. They are enjoying their gold-plated toilets in Dubai, while I am borrowing money to stop my roof from leaking. I'm tired of it.

    June 13, 2012 at 9:19 am |
  17. Uncle Bubba

    TO ALL: Your arguments are all lucid and compelling (well, almost all). I actually enjoy reading most of your positions. I would offer this opinion for your consideration...in the end, it all boils down to one thing: whoever has the most money and is willing to spend it on Capitol Hill, that is who determines what we will put in our cars, airplanes, etc... I have been around a long time. I have watched this carefully. In the end, regardless of the technology, regardless of manufacturing and labor cost, regardless of the savings, regardless of the benefit to mankind...the one factor that ultimately determines what consumers have and use is the amount of money "spent" in Washington DC. Whoever is willing to spend the most there, that is who gets their way. Period. The people don't determine what happens, the politicians don't determine what happens...it is the lobbyists and special interest groups that control everything. Why? They have the money...lots of it. Remember the golden rule: He who has the gold, makes the rules. Think about it.

    June 13, 2012 at 9:59 am |
  18. Welled

    Now its called fracking. Look go back where you came from if their is anything left of the place your lucky. I don't really care I love hearing Mrs Yamamoto's teeth rattle in the middle of the night. Is fracking drilling 30 miles through the rock shelves of the earth to get oil?

    June 13, 2012 at 12:27 pm |
  19. Kenser

    >> stable, democratic countries like the United States, Canada, Australia, Poland, France and Israel.

    That statement really makes me laugh... 🙂

    June 13, 2012 at 1:45 pm |
  20. Bruce

    Its destroyng the water table

    June 13, 2012 at 5:10 pm |
  21. ryan378

    I would love to see the transportation, service industry, and municipal transportation (police, fire, govt vehicles) all adopt natural gas. You can add that infrastructure in the form of tanks, at existing filling stations and truck stops fairly easily. It certainly wouldn't be the overly ambitious and expensive project to do it with the entire civilian market and privately owned gas stations.

    With 100 years of natural gas and more being found all the time, and with the new cancer study and diesel fumes – this would be a phenomenal way to get a lot more out of our oil reserves and lower prices for a trucking industry that is having a hard time. As well as a likely drop in prices to anything they haul. We all know how prices jump when gas jumps.

    June 13, 2012 at 8:39 pm |
  22. Leftcoastrocky

    Fareed, what are these "rules?"

    "Let's figure out how to make fracking cleaner and safer. We can regulate the process with good, simple rules."

    June 13, 2012 at 9:23 pm |
  23. Em

    Is 100 years of natural gas worth ruining entire aquifers? Do we have a technology that magically manufactures clean water saftely and inexpensively, or are all the reports from the DoD about clean water being one of the galvanizing national security issues for the next 25 years just something that is ignored? If clean water could just magically appear, no one would need billions in US dollars to de-salinate sea water. Just sayin'. Natural gas, or potable water? Hmmm. Mr. Zakaria, have you talked to any hydrologists lately?

    June 13, 2012 at 10:34 pm |
  24. Jefferson_Lives

    Fareed = Communist 😛

    June 14, 2012 at 1:27 am |
  25. RJ Reid

    I live in Colorado where fracking is literally going on in people's backyards(Check out Greeley's skyline) and the chemicals they use with the water they will not disclose. They will not discuss nor do they want to talk at all about ground table and well water contamination from escaped methane and whatever chemicals are used in the water. I got neighbors who can light the well water coming out of their tap with a bic lighter. I live in a County that is completely monopolized and run politically by Republican/GOP Commissioners. The county Weld County, has the poorest income per-capita and the highest amount of children living below the poverty level than any other County in Colorado. The school systems in Weld County are rated the worst in Colorado and have the lowest CSAP scores in all of Colorado. The highest unemployment rate in all of Colorado is in Weld County. The highest foreclosure rate in all of Colorado was Weld County for about the last 7 years in a row. Now you would think with the oil and gas production boom and the fact over 1200 fracking sites have been erected in the last three years that all of the above should be just the opposite if Republicans, the GOP establishment, and oil and gas corporations were telling the truth about the jobs and wealth they create in the communities they operate. So if you want your own community or County to have the same enviroment.in low wage job prospects with no health care benefits, and want your children's education and IQ to only equal that of rural peasants in Quatemala, if you thrive on low wages, poverty, and contaminated ground water like in Weld County Colorado. If you want to prove you are a true GOP patriot, then please invite oil and gas companies/corporations to set up 300 to 500 foot foot drilling operations towers in your back yard so you can use your tap water to barbecue ribs or even create a flame thrower from the water from your garden hose and let the kids play with it, then please, please, by all means vote and keep voting for Republicans. All the above realities of total Republican political tenure will soon be yours to have in your own your own community. By the way, some of these towns like Greeley have "Man Camps" on their outskirts and the most insidious spikes in crime of all kinds just skyrocke in every place this industry sets up. Just go read the Greeley Colorado Tribune daily headlines for a month if you be a "Doubting Thomas" about the facts I am giving you.

    June 14, 2012 at 6:30 am |
  26. Alex

    This entire article is a corporate wet-dream. Thank you Fareed for selling out, I'll know better next time than to read your garbage.

    And if the desperate people of America are poised to poison their drinking water for some cheep energy, do it the F#$K away from Washington State, where I live.

    The Germans are massing solar energy projects, and investing in real futuristic endeavors; while we decimate our environment so that some Industrialists can pocket the big-bucks and retire off shore.

    Fantastic

    June 14, 2012 at 8:35 am |
  27. phartimarti

    Dear Earthians:Any discussion of this planet's gas deposits would be incomplete without mention of methane hydrates which occur abundantly in the world's oceans, tundras and swamps .How about monetizing THAT before global warming results in it's catastrophic release into an oxygen rich atmosphere?

    June 14, 2012 at 9:42 am |
  28. lawrencemannino

    Kind of a low-depth article – sure, there's some potential in Natural Gas, and ANGA is managing a terrific PR campaign disguised as feel-good commercials, but a couple of other questions come to mind, like why just say that methane is a 'greenhouse gas', without explaining its radiative forcing (very basically, the ability to trap heat within the atmosphere, which can lead to global warming) capacity versus alternatives? Most studies show methane's capacity to be up to 25 times more potent than carbon dioxide. And in terms of safety, can someone from San Bruno weigh in? Oh...right. Not to mention does anyone really want the potential hydrogen bomb that is an LNG tanker in the waterways around NYC or Boston? Plus, and this goes under examined, there is, I think an implicit idea that if we (the US) produces all of the Natural Gas that prices will somehow plummet for the average consumer. The reality, I think, is that once the infrastructure is in place (often supplemented by taxpayer dollars) then the laws of supply and demand will fall into place, prices will rise to oil-type levels, large energy companies will continue to get richer on our dime, and if overseas demand is right, we're basically going to be destroying our country in order to export 'new friends'. Quite frankly, both natural gas and oil are dredged from the same dinosaur muck, and none of it's renewable. Biofuels (not corn-based: think algae or even switchgrass), are renewable and effective and could be a true fix, as could solar in a few years. Unfortunately, no one in the corporate-indutrial complex that seems to guide policy in this country is positioned to make money (or get PAC donations), from this route, so once again we move toward what looks, increasingly, like the dark dystopian future envisioned by writers like Orwell and Huxley.

    June 14, 2012 at 11:07 am |
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