"Checkmate for cheap unconventional gas:" Dizard in FT.

John Dizard in the FT: “….The share prices of primarily gas-directed US exploration and production companies are not doing so well this year, at a time when the macro prospects could not be better. Not only are there more equity sellers than buyers, but the junk-rated US E&P companies are selling nearly 80 per cent less public debt this year than they were by the same time last year.”
“Do natural gas investors and lenders know something other people do not?
In the short term, as in the next year or so, yes, they do. It is going to take much longer, and require much more money, to get that unconventional gas produced than global strategists presume. Five years ago, investors and lenders were willing to believe any story about shale gas. Now the money people are probably more sceptical than they should be about the price prospects for natural gas, and the profits to be had from producing it.
Essentially, the shale gas boom of the past decade turned a set of engineering advances into a property bubble, in which investors were selling development rights to each other, intermediated by the exploration and production companies. The E&P promoters were spending multiples of their operating cash flow on buying properties and drilling them to show more production, then selling more stock and more debt, etc. Eventually, the promoters could not pedal fast enough. After the (temporary) fall of Aubrey McClendon, the most visible promoter, and chief executive ofChesapeake Energy, the most visible shale gas company, the investment world backed away from shale, even as the political world embraced it.
….As the US and anyone counting on its gas exports will find out, inducing enough rigs and crews to produce more gas, and building enough processing facilities and pipelines to get it to where it is needed, will probably cost at least another couple of dollars per million British thermal units. Otherwise production will decline, or be trapped in under-connected areas such as parts of the Marcellus Shale in the eastern states.
And when prices for gas do rise in the years to come, they will, for a while, rise further than central planners or grand strategists would like.
Investors in pipelines and processing facilities will do well. Buyers of now-deflated natural gas properties will do very well. Those gas company management groups who come out on top in the industry’s coming merger and acquisition wave will do very, very well.”