US shale gas exports 'no threat'
"We don't think it's a significant risk," said Diana Hoff, Santos' vice-president of technical and engineering.
Factors holding back US shipments include the lack of infrastructure and whether the US government will allow shipments of scale, Ms Hoff said.
Major Asian gas importers, such as Japan, have reportedly been talking up the prospects of buying US gas in a bid to cut prices, just as energy companies ramp up huge new gas projects in Australia.
Santos is stepping up its development of shale and other so-called unconventional gas reserves, particularly in the Cooper Basin.
The company drilled its first commercial shale gas well last September and is planning its first three vertical and horizontal well sets in coming quarters. Gas priced at between $6 and $9 per gigajoule "will be economic for the shale gas", Ms Hoff said.
The Cooper Basin is Australia's most prospective and commercially viable region for shale gas. The US Energy Information Administration estimates the basin has about 85 trillion cubic feet of gas, roughly equivalent to 85 years of Australia's current usage.
"The early signs are good," Ms Hoff said, adding it would take about 15 wells to assess the potential.
While technical boundaries will be challenging, so may be environmental ones. In June, a survey of unconventional gas production published by the Australian Council of Learned Academies highlighted the potential for contamination of freshwater aquifers.
Frequently Asked Questions about this Article…
According to Santos vice‑president Diana Hoff, US shale gas exports are unlikely to be a significant threat to Australian gas producers. She says key constraints — notably limited export infrastructure and uncertainty over whether the US government will allow exports at scale — limit the impact on Australian supply and pricing.
Santos is stepping up shale and other unconventional gas development, focusing on the Cooper Basin. The company drilled its first commercial shale gas well last September and plans to run its first sets of vertical and horizontal wells in coming quarters — moves that could affect Santos’s production profile and long‑term value for investors.
The US Energy Information Administration estimates the Cooper Basin holds about 85 trillion cubic feet of gas. The article notes that’s roughly equivalent to 85 years of Australia’s current gas usage, highlighting the basin’s potential significance for domestic supply and commercial development.
Santos’s Diana Hoff said shale gas economics look viable when gas is priced between $6 and $9 per gigajoule. For investors, that price range can be a useful benchmark when assessing the potential profitability of shale projects.
Ms Hoff said it would take about 15 wells to properly assess the Cooper Basin’s shale gas potential. She also described the early signs as positive, but noted more drilling will be required to confirm commercial viability.
The article highlights two main barriers: a lack of export infrastructure in the US and uncertainty over whether the US government will permit shipments at the required scale. Both factors could limit how much US shale gas actually reaches Asian markets.
Yes. The article cites a survey by the Australian Council of Learned Academies that flagged the potential for contamination of freshwater aquifers. It notes that while technical challenges exist, environmental boundaries could also be a significant constraint on development.
The article reports that major Asian importers such as Japan have been exploring US gas purchases to try to lower prices. However, Santos believes the overall risk to Australian producers is limited because US exports face infrastructure and regulatory constraints, while Australian companies are simultaneously ramping up large new projects.
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