On April 1-2, 2016, the Energy Center at the Kenan-Flagler Business School, University of North Carolina at Chapel Hill convened a conference on “Global Frac’ing, What has to Change for it to be a Game Changer?” It was an invitation only event with attendance limited to industry experts, leading consultants and responsible government officials. Attendees and speakers came from the U.S., UK, Poland, Mexico and Canada. This report summarizes the main points which emerged from the speaker presentations and subsequent discussion. It does not attempt to be a comprehensive treatment of Global Frac’ing. Rather, it raises four sets of questions and presents the conclusions which developed. The Executive Summary provides an overview of these conclusions. The appendices share details on two matters much discussed – what would be a model regulatory regime for unconventional development, and what would constitute a model fiscal regime?

We introduce a novel approach to estimating latent oil risk factors and establish their significance in pricing nonoil securities. Our model, which features four factors with simple economic interpretations, is estimated using both derivative prices and oil-related equity returns.

Hydrocarbon derived from fast pyrolysis of plantation wood is a potential feedstock for the production of transportation fuels. Unfortunately, the cost to produce and upgrade this feedstock is highly uncertain, and its current technological state is not competitive with crude oil. Additional R&D will be needed to achieve the significant cost reductions required for competitiveness. Significant technical hurdles must be overcome to achieve a commercially ready, cost competitive technology. This paper identifies the most promising areas for the needed future research.

The process for producing advanced bio-fuels from woody biomass using fast pyrolysis technology is in an early stage of development. Whether it will offer favorable economics versus future petroleum-derived fuels or other advanced bio-fuels is not clear at this time; however, a study of the value chain from growth to final distribution of drop-in bio-fuels has highlighted several factors that will have major impact on ultimate economics.