Shale gas is an unconventional natural gas produced from shale, a type of sedimentary rock. Shale gas has become an increasingly important source of natural gas in the United States over the past decade, and interest has spread to potential gas shales in Canada, Europe, Asia, and Australia. One analyst expects shale gas to supply as much as half the natural gas production in North America by 2020.

In a 2013 report, the US Energy Information Administration estimated the quantity of technically recoverable shale gas for 41 countries. North America leads the worldwide production of shale gas, with the US and Canada having significant levels.US Energy Information Administration, 23 Oct 2013 Beyond the US and Canada, shale gas is so far produced at a commercial scale only in Argentina and China. While the shale gas potential of many nations seems promising, there are several obstacles spanning several economic, environmental, technical and social issues grouped in major categories such as access to resources, infrastructure and governance.

Shale gas production has been blocked in many countries largely because of the environmental risks involved. These risks and social concerns have resulted in legal restrictions on hydraulic fracturing, that have prevented a more extensive development of shale gas worldwide.

Africa

South Africa

South Africa has a major sedimentary basin that contains thick organic-rich shales: the Karoo Basin in central and southern South Africa. The Karoo Basin is large, extending across nearly two-thirds of the country, with the southern portion of the basin potentially favorable for shale gas. However, the basin contains significant areas of igneous sill intrusions that may impact the quality of the shale gas resources, limit the use of seismic imaging, and increase the risks of shale gas exploration. The Karoo is estimated to have technically recoverable resource of 485 trillion cubic feet (Tcf) of gas.

Several companies intend to explore for shale gas using hydraulic fracturing in the Karoo region. This is bitterly opposed by a coalition of environmentalists, farmers and local residents.

Falcon Oil & Gas Ltd. was an early entrant into the shale gas play of South Africa, obtaining an 11,600-mi2 (30,000-km2) Technical Cooperation Permit (TCP) along the southern edge of the Karoo Basin. Shell obtained a larger 71,400-mi2 (185,000-km2) TCP surrounding the Falcon area, while Sunset Energy holds a 1,780 mi2 (4,600-km2) TCP to the west of Falcon. The Sasol/Chesapeake/Statoil JV TCP area of 34,000-mi2 (88,000-km2) and the Anglo Coal TCP application area of 19,300 mi2 (50,000-km2) is to the north and east of Shell's TPC.

Americas

Argentina In June 2013, the US Energy Information Administration estimated that Argentina held 802 trillion cubic feet of recoverable shale gas reserves, the third largest in the world.US Energy Information Administration, World shale gas resources, 5 April 2011. Large reserves of tight oil and gas were in the Vaca Muerta formation. In 2014, three-quarters of the shale gas and oil concessions in the country were held by the Argentinian company YPF (nationalised in 2012) which committed to develop the Vaca Muerta field with US company Chevron Corporation. However, in spite of a hydrocarbons law favourable to exploring and developing companies and passed by the Argentine Senate in 2014, the Financial Times noted that "Some analysts doubt whether many companies will follow Chevron until Argentine's erratic president Cristina Fernandez, leaves power in 2015."Mander, Benedict and Webber, Jude (3 November 2014) "YPF courts oil major to unlock Argentine shale" the Financial Times, page 19, Companies and Markets. A similar article is available on the Internet with a subscription at

Canada

Recent shale gas discoveries have caused a sharp increase in estimated recoverable natural gas in Canada.Carrie Tait, "Canada's natural gas resource jumps dramatically in estimates" , Montreal Gazette, 13 May 2010. The nation has a number of prospective shale gas targets in various stages of exploration and exploitation in British Columbia, Alberta, Saskatchewan, Ontario, Quebec, New Brunswick and Nova Scotia.Kevin Heffernen, Shale gas in North America, emerging shale opportunities , PDF file, retrieved 15 April 2009.

One major area of exploration in Canada is north of Fort Nelson, in north east British Columbia. Encana and EOG Resources are developing the area known as Horn River due to its high yield shale deposits. A number of these well sites are serviced by Alberta fracturing companies, many of which started out as a one-person operation with the purchase of a cement truck.

This rapid expansion of shale gas in Canada is not without controversy. On 8 March 2011, the Quebec provincial government effectively declared a temporary moratorium on the use of chemical fracturing during shale gas drilling pending a stricter full environment assessment audit. Acting under recommendations from a provincial environmental assessment board, Quebec Minister of Environment Pierre Arcand stated that "We are committed to making sure that it is done properly or it won't be done at all,"RHÉAL SÉGUIN, , Globe and Mail, 8 March 2011. The assessment board cites the chief concern of groundwater contamination with respect to the St. Lawrence valley, and recommended the audit in order to fully inform and involve communities and the public of the risks involved in shale gas exploitation in Quebec.

Mexico Mexico drilled its first shale gas well in 2011, in the Burgos Basin of northern Mexico, in the equivalent of the Eagle Ford Formation of the US. But as of February 2013, there have been only six productive shale gas and tight oil wells drilled in Mexico (a seventh was abandoned as non-productive), all producing from Eagle Ford equivalent.David Alire Garcia, "Mexico still far from tapping shale potential, minister says", Toronto Globe and Mail, 8 May 2013. The national oil company Pemex has limited investment capital, and focuses its effort on what it sees as higher-return conventional oil and gas projects, rather than gas shales or tight oil.Roberto Lozano, The challenges for shale gas production in Mexico , 2013, Regional Workshop on the Changing Global Market and Unconventional Gas, Jakarta, Indonesia The US Energy Information Administration estimates Mexico's recoverable reserves of shale gas to be 681 trillion cubic feet, the fourth largest shale gas reserves in the world.

In Mexico's case, the relevance of shale gas passed from official speeches to energy policy priorities, with two scenarios of production included in the Energy Strategy 2012. With five shale basins preliminarily identified, the business-as-usual scenario in the Strategy encompassed the development of only one shale gas play, with the more favorable scenario adding another play. For each scenario, production would start by 2016 with the output expected amounting to 15% and 29% from the total gas production expected by 2026. By early 2013, the thrill of shale gas started to transform, with less fanfare in the edition of the Strategy that year, recognizing that in spite of the considerable shale gas potential, the path of development chosen would be constrained by Mexico's legal and economic framework, with more favorable opportunities depending on the implementation of more ambitious measures, namely an energy reform that could complement the state-owned oil and gas monopoly of more than 75 yearsJuan Roberto Lozano-Maya, The United States Experience as a Reference of Success for Shale Gas Development: The Case of Mexico, 2013, Energy Policy, Vol. 62.

While this reform was eventually accomplished, other challenges must be surmounted.Dudley Althaus, "Zetas gang poses daunting threat to Mexico's shale gas", Houston Chronicle, 26 Sept. 2012. Mexico's shale oil and gas development close to the US border is hampered by the activities of organized criminal groups that include the theft of pipeline products and the extortion to companies in the extractive industries, along with lack of adequate infrastructure; overall, this has resulted in the low economic competitiveness of Mexico's shales in comparison with those across the border in the United States soil. It remains to be seen if the awaited Mexican energy reform will overcome these drawbacks. Owing to Mexico's weak rule of law and poor success in previous major industry reforms, the legal changes brought about might as well end up worsening the drawbacks in the energy sector and namely in the development of the country's shale resources.

United States

The first commercial gas well drilled in the US, in 1821 in Fredonia, New York, was a shale gas well producing from the Devonian Fredonia Shale formation. After the Drake Oil Well in 1859, however, shale gas production was overshadowed by much larger volumes produced from conventional gas reservoirs.

In 1996, shale gas wells in the United States produced , 1.6% of US gas production; by 2006, production had more than tripled to per year, 5.9% of US gas production. By 2005, there were 14,990 shale gas wells in the US.Vello A. Kuuskraa, Reserves, production grew greatly during last decade Oil & Gas Journal, 3 Sept. 2007, p.35-39 A record 4,185 shale gas wells were completed in the US in 2007.Louise S. Durham, "Prices, technology make shales hot," AAPG Explorer, July 2008, p.10. In 2007, shale gas fields included the No. 2 (Barnett/Newark East) and No. 13 (Antrim) sources of natural gas in the United States in terms of gas volumes produced.US Energy Information Administration, Top 100 oil and gas fields , PDF file, retrieved 18 February 2009.

A study by MIT says that natural gas will provide 40% of America's energy needs in the future, from 20% today, thanks in part to the abundant supply of shale gas. With 4% annual production growth expected between 2010 and 2030, shale gas has been "a veritable game changer" for the United States.

Shale gas, especially from the Marcellus Shale, have tested up to 16% ethane content. This low priced feedstock for ethylene synthesis has led to a "frenzy" of new ethylene plants in the US.

Asia Turkiey

According to data obtained from the US energy information. Turkey has 679 billion cubic meter shale gas reserves, especially in the Southeastern Anatolia and Thrace regions, 651 billion cubic meters can be drilled in the first stage.

China

China has set its companies a target of producing 30 billion cubic meters a year from shale, equivalent to almost half the country's gas consumption in 2008. Potential gas-bearing shales are said to be widespread in China, although as yet undeveloped.Zinchuan Zhang, "Unconventional gas systems in China," 33rd International Geological Congress, Oslo, 6–14 August 2008. In November 2009, US President Barack Obama agreed to share US gas-shale technology with China, and to promote US investment in Chinese shale-gas development.White House Blog, The US and China: towards a clean energy economy, 17 November 2009.

China launched a national shale gas research centre in August 2010. Based on existing reports, China may have 30 trillion cubic metres of shale gas reserves.Reuters, China launches national shale gas research centre, 23 August 2010. In a 2011 report, the US Energy Information Administration estimated that China had 1,275 trillion cubic feet of recoverable shale gas, the largest reserves of all countries surveyed in that report.World Shale Gas Resources: An Initial Assessment of 14 Regions Outside the United States.