Shale gas--the unfolding story
In the early 2000s US gas production was in slow but steady decline despite increasing drilling activity. As US natural gas prices rose in response to the resulting tight market, the only supply-side solution appeared to lie in the development of liquefied natural gas (LNG) projects in the Middle East and Africa for importation to the North American market. Almost unnoticed in its early stages, the US shale gas phenomenon gathered momentum from 2004 onwards through the combination and application of two proven technologies, namely horizontal drilling and pressure-induced hydraulic fracturing or 'fracking'. The pioneers of this approach were not the majors but the much smaller, domestically focused 'independent' upstream companies who, together with a well-established and adaptable service sector, instigated what is now commonly referred to as the 'shale gas boom' and which has increased US natural gas production to the point where only minimal imports of LNG are expected to be required for the foreseeable future. This paper looks at the genesis of the US shale gas industry, the intensive nature of its operations, and the factors which have underpinned its success to date. It also addresses the question of whether similar developments might be expected in Europe and what specific challenges would need to be overcome. In a world where increased LNG supply has created trade flow and price linkages between regional gas markets, the paper also examines the impact US shale production has had on other markets through the re-direction of LNG originally intended for the US market. Copyright 2011, Oxford University Press.
If you experience problems downloading a file, check if you have the proper application to view it first. In case of further problems read the IDEAS help page. Note that these files are not on the IDEAS site. Please be patient as the files may be large.
As the access to this document is restricted, you may want to look for a different version under "Related research" (further below) or search for a different version of it.
When requesting a correction, please mention this item's handle: RePEc:oup:oxford:v:27:y:2011:i:1:p:117-143. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: (Oxford University Press)or (Christopher F. Baum)
If references are entirely missing, you can add them using this form.