Northwest Canada's remote Liard Basin is the world's ninth-largest shale gas resource, according to a new assessment released by Canadian regulators on March 16, although it could take years to develop due to depressed global energy prices.
The basin, mostly situated in British Columbia but also straddling the Yukon and Northwest Territories borders, is estimated to contain 219 trillion cubic feet (Tcf) of marketable, unconventional natural gas.
That makes it the second-largest gas resource in Canada behind the Montney Formation in British Columbia and Alberta, and among the biggest shale gas plays in the world.
"We thought the resource was going to be big based on its characteristics; it's so deep and so heavily pressured. But we didn't think it would be this big," said Mike Johnson, technical leader of hydrocarbon resources at the National Energy Board (NEB), the country's oil and gas regulator.
The world's largest shale gas play is the Sichuan Basin in China, with more than 600 Tcf of marketable recoverable gas, according to the NEB.
The Liard Basin holds enough gas to supply Canada for more than 68 years based on 2014 gas consumption levels, said the assessment, which was conducted by the NEB and government agencies from British Columbia, the Yukon and the Northwest Territories.
However, with global energy prices near multi-year lows as a result of a prolonged glut of crude oil, analysts say the economics of developing the shale gas basin are challenging.
"This is great news; it underscores the capacity of this play in Canada, but the real challenge is trying to figure out ways to monetize the resource base," said Teri Viswanath, managing director of natural gas at PIRA Energy Group.
At present Chevron Corp. (NYSE: CVX) and Woodside Petroleum are among the major developers of the Liard Basin, with plans to use the gas to supply the proposed Kitimat LNG export facility on Canada's Pacific coast.
Recommended Reading
Tinker Associates CEO on Why US Won’t Lead on Oil, Gas
2024-02-13 - The U.S. will not lead crude oil and natural gas production as the shale curve flattens, Tinker Energy Associates CEO Scott Tinker told Hart Energy on the sidelines of NAPE in Houston.
Chesapeake Enters into Long-term LNG Offtake Agreement
2024-02-13 - Chesapeake Energy entered into a long-term liquefaction offtake sale and purchase agreement with Delfin LNG and Gunvor Group for a 20-year period.
The Secret to Record US Oil Output? Drilling Efficiencies—EIA
2024-03-06 - Advances in horizontal drilling and fracking technologies are yielding more efficient oil wells in the U.S. even as the rig count plummets, the Energy Information Administration reported.
CERAWeek: Gunvor Sees Balanced Oil Market, No Tightness in LNG Supplies
2024-03-18 - The global LNG market is not currently tight, Gunvor Chairman Torbjörn Törnqvist said at CERAWeek, contradicting the view shared earlier in the day by TotalEnergies.
What's Affecting Oil Prices This Week? (March 18, 2024)
2024-03-18 - On average, Stratas Advisors predicts that supply will be at a deficit of 840,000 bbl/d during 2024.