HELSINKI (Reuters) - The chairman of oil major Royal Dutch Shell (RDSa.L) called on Europe to better exploit opportunities in shale gas, telling a Finnish newspaper that the region risked losing the battle of economic efficiency to the United States’ shale boom.
“Europe must make its energy policy more competitive,” Jorma Ollila said in an interview with Tekniikka & Talous.
“Shale gas has given the United States a competitive advantage as their gas is cheap. That leads to cheap electricity and lower production costs.”
Shell secured China’s first product sharing contract for shale gas a year ago, and signed a $10 billion (6.6 billion pounds) shale gas deal with Ukraine earlier this year. Yet France, estimated to have Europe’s largest reserves at around 180 trillion cubic feet, has banned the procedure of extracting shale gas known as fracking.
Environmentalists say fracking, which involves pumping vast quantities of water and chemicals at high pressure through drill holes to prop open shale rocks, could increase seismic risks and pollute drinking water. Advocates say a higher proportion of gas use would help curb carbon dioxide emissions.
Ollila said it would take until the 2040s or 2050s for alternative energies such as solar power and biomass to begin producing at significant levels, and that shale gas would provide a way to help curb emissions in the meantime.
“As many countries have said no to nuclear power, gas is by far the most advantageous by its price as well as its environmental impact.”
Ollila has been board chairman at Shell since 2006. He is best known for being CEO of Nokia NOK1V.HE from 1992 to 2006. While he is credited for leading Nokia’s transformation from a rubber boots and TVs conglomerate into a global leader in mobile phones, he is also blamed for a slow response to the smartphone revolution led by Samsung (005930.KS) and Apple (AAPL.O). He stepped down from his role as Nokia chairman last year.
Reporting By Helsinki newsroom; Editing by Tom Hogue