Abstract for: Exploring the Effects of Shale Gas Development on Natural Gas Markets: a Multi-method Approach
Now that conventional gas resources are rapidly declining in many industrialised regions, national governments are considering the exploration and production of unconventional resources, with shale gas in particular. Large-scale development of these resources could significantly lower the import dependency of the gas supply of many countries. The complexity of gas markets and the uncertainties affecting it make that simulation modelling is required to assess these economic implications of global shale gas development. In this study, System Dynamics and Agent-based Modelling are deployed in parallel to discover scenarios for the effects of shale gas development on regional gas markets, while accounting for method uncertainty. It is shown that the gas market is mainly demand-driven, hence forecasts for economic growth are likely to have a larger impact on gas import dependency than the actual size of shale gas resources. The use of a multi-method approach provided additional insights in the behaviour of gas markets. Future work should focus on the inclusion of additional structural uncertainties in order to obtain a more complete view on plausible economic implications of global shale gas development.