Coal bed methane production in the Asia region is expected to reach 98 billion cubic meters by 2020, with Australia expected to contribute over 60 percent of this total, according to the Resource Investing News; China and India are the next major contributors and have projects underway to exploit new resources over the next few years.
China is estimated to hold CBM reserves of 36.8 trillion cubic meters, according to the China Daily, giving it the third-largest reserves after Russian and Canada.
With natural gas prices finally rising in the US and reserves in storage falling, it seems likely the US may have begun to turn the corner on natural gas prices, being so low they hinder new exploration and development.
But the reverse is the case in Asia, where prices are so high they are hindering the switch from more polluting coal as a source for power generation to less polluting natural gas.
The development of Australian and other Asian coal bed methane reserves is being spurred by those same high prices, a situation which is unlikely to be reversed as air quality standards are gradually raised and a cost for pollution becomes more commonplace.
In the US, the cost of complying with tougher Environmental Protection Agency (EPA) air quality standards could spur an increased shift away from coal and toward natural gas for electricity generation, according to a new Duke University study quoted in this article.
Stricter regulations on sulfur dioxide, particulate matter, nitrogen oxide and mercury may make nearly two-thirds of the nation’s coal-fired power plants as expensive to run as plants powered by natural gas, the study found. Even if gas prices rise considerably from current levels, it would be more economically sound to build a new gas-fired power station than to upgrade an old coal-fired one to meet the new standards, according to research quoted in the article.
Coal bed methane may be some countries’ answer to the game-changing impact of shale bed gas in the US as the less environmentally contentious nature of its production proves more acceptable – or geology favors CBM formation over shale.