‘What the Thunder Said’ is the final section of T. S. Eliot’s 1922 masterpiece, the Waste Land (our favourite ever piece of literature!). The poem describes a bleak world where nothing will grow. At the end, giant storm-clouds burst open with rain, bringing a new hope, for a return to growth and productivity.
This is our analogy for the energy industry, which is also emerging from a bleak, inefficient, low-growth period… its own “Waste Land”. Great disruptions are casting a shadow. But ultimately, we think new technologies will bring a return to growth and productivity.
Particularly for Shale Oil. While running the energy team at Redburn, in 2017, we reviewed over 100 technical papers, arguing shale oil was a new technology paradigm. Our ‘Top 20’ emerging technologies had scope to double shale productivity. Hence we argued that shale oil would continue surprising to the upside, escalating supply-growth, restoring industry profitability and forcing beneficial adaptations throughout the oil and gas space. Go to a frac site, and you will hear first-hand “what the thunder” sounds like.
The analogy also holds for the energy transition, amidst the rise of renewables. Rather than destroying demand, new energy sources will create unfathomable new demand, as per the past 250-years’ of energy transition. And again, the disruption will force beneficial adaptations through the energy system, forcing incumbents to operate more efficiently.
Finally, the analogy applies to the research and consultancy industries, amidst the storm clouds of new regulation. Most analysis is similar, hugging a narrow consensus. It may be beneficial — like the Waste Land — to take a different approach, drawing on a wide range of source material, which is why our research focuses on themes, technologies, technical papers and patents.