Herb Vogel, the CEO of BP Energy Co. North America Gas & Power, said last week the abundant natural gas supplies in the United States and Canada — including the tremendous indigenous supplies supplanted with regasified liquefied natural gas (LNG) — will lead to “profound, revolutionary changes” in the coming decades.

Vogel, the keynote speaker on Tuesday at GasMart 2010 in Chicago, said increased global gas supplies would be instrumental in transitioning to what he called a “low-carbon century.”

BP has been at the forefront in a push for more alternative energy sources. It is the leading physical natural gas marketer in North America. BP also is the leading wind producer in the United States.

Alternative energy sources, said Vogel, can be used successfully in conjunction with carbon capture and storage for coal emissions, increased gas for power generation and more nuclear generation. The beefed up power sources all would be “underpinned” by abundant new gas supplies.

The U.S. gas rig count fell as prices and the economy took a dive in late 2008, but now the “overall U.S. gas rig count has recovered to surpass year-ago levels,” Vogel noted. The turn onshore has been easy to see with the uptick in unconventional gas plays “driven by acreage capture and higher liquids value.”

Vogel said the gas supply growth had been a “quiet revolution,” prompted first by a strong price signal that led to increased exploration and production investment. Higher activity and new technologies led to increased production, which in turn led to a reevaluation of shale gas. Shale gas reserves alone led to a 35% increase in estimated resources, said the BP chief.

“There has been a paradigm shift in U.S. gas resources,” he noted. In 2003 conventional resources made up nearly all of the then estimated 1,451 Tcf of gas resources. By 2006, coalbed methane (CBM) and a slight uptick in shale gas reserves pushed the total to 1,532 Tcf. In 2006, conventional reserves still led, but shale gas resources were close behind and CBM was holding its own, all contributing to around 2,074 Tcf, Vogel noted.

The big key was technology. The Barnett Shale led the way in fits and starts. It has around 8,052 producing wells that contribute around 4,000 MMcf/d. However, with experimentation and new technology, the much younger Haynesville Shale’s forecast trend line is 2,575 wells producing more gas in less time.

There are, of course, risks for domestic gas drillers, said Vogel. Especially in the unconventional plays, which use a lot of water resources during hydraulic fracturing procedures, stakeholders are concerned about environmental impacts from hydraulic fracturing. Producers also face new operating challenges, which include higher costs and training more people, he said.

In BP’s view, however, gas offers the most reliable and secure way to lower carbon dioxide (CO2) emissions, all of which should be included in “prudent climate change action, which would include “an economy-wide carbon price, with transportation, industry, the power sector — including natural gas, renewables and coal — all competing on a level playing field” (see related story).

If the “necessary technology” is used within a “stable fiscal and regulatory framework,” it’s BP’s view that “natural gas can fundamentally transform the energy outlook and emissions profile in the decades — and now even in the low-carbon century — ahead.”

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