Shale gas revolution shaking up the world

A recent report by the United Kingdom Institute of Directors has forecast the creation of more than 35,000 jobs from shale gas development in the UK, on the assumption that government approval for fracking is granted.

China has large shale reserves and is reportedly taking a deep interest in the US shale gas revolution and the underpinning technology.

Of course Australia could also be affected by the entry of the US into the gas export market, given the significance of our LNG exports into Asia.

One of the more interesting outcomes of the shale gas revolution is that the US appears to be on track to meet Kyoto targets for emissions reductions.

There is more than a little irony involved given that the US did not ratify the Kyoto targets and has imposed neither a price on carbon nor an emissions trading scheme.

European nations face the prospect of rising emissions due to increased reliance on coal for electricity production, with much of that coal coming from the United States.

Australia would be well advised to heed the approach of US policy makers who have long argued that technology and innovation are the pathways to reducing emissions, rather than punitive taxes.