* Europe looking at how to exploit its shale gas reserves
* EU gas prices around four times higher than in the U.S.
* EU also debates single energy market, efficiency
By Barbara Lewis and Peter Griffiths
BRUSSELS, May 22 European leaders discussed the
region's reserves of shale gas at a summit on Wednesday, but the
prospect of the continent enjoying a U.S.-style shale boom that
drastically cuts energy costs remains elusive.
Arriving at the summit, British Prime Minister David
Cameron, whose government is advancing plans to exploit his
country's shale gas deposits, said Europe could not afford to be
left behind as the world scrambles to develop the resource.
He drew a comparison with the United States, where years of
extraction, using a much-criticised process of hydraulic
'fracking', has delivered record-low gas prices for consumers.
"We mustn't be left behind in the global race," Cameron told
reporters. "Europe has 75 percent of the United States's shale
resources, but America is drilling 100 times faster than
For the European Union, there is no broad-based agreement on
how shale gas should be developed, with some of the EU's 27
member states completely opposed to any exploration, others in
two minds and a few fully committed to it.
At the same time, the European Commission says environmental
standards must be maintained, and potential investors in shale
gas have to consider Europe's more complex land-ownership and
mineral extraction laws.
Other issues include the greater depth of EU shale gas
reserves compared with the United States, which can increase
drilling costs by a factor of three, analysts say.
Of EU nations, the eastern states of Poland and Lithuania
are among the keenest to cut their reliance on imports of
natural gas from Russia by developing shale gas of their own or
importing it in liquid form from the United States.
While gas prices in the European Union are roughly four
times higher than in the United States, analysts say U.S.
prices will inevitably rise as production costs can exceed
income from the gas.
Rex Tillerson, CEO of the largest U.S. natural gas producer,
Exxon Mobil Corp, said: "We are all losing our shirts
today," when talking about natural gas prices, a comment that
hints at the double-edged nature of the asset.
European Council President Herman Van Rompuy said Europe
needed to tap all resources, but it was up to individual member
states to make their own energy choices.
"Yes, this includes shale gas which could become part of the
energy mix for some member states, perhaps less for others," Van
Rompuy said. "Soon Europe could be the only continent to still
depend on imported energy. Households feel the weight of high
prices, industry finds it hard to compete with foreign firms."
Apart from shale gas, summit documents also focus on
completing the single European energy market.
In theory, better cross-border connections can help to lower
prices and increase security of supply, but more than half a
century after the founding of the European Union, the single
energy market is still incomplete.
For many, shale gas is far more unrealistic. Green
politicians and environmental campaigners say it is a dangerous
distraction from the pursuit of carbon-free energy and energy
efficiency, which they say is the best way to free the European
Union from expensive fossil fuel imports.
(Additional reporting by Ethan Bilby, Adrian Croft, Martin
Santa; editing by James Jukwey)