Shale Gas Market - Growth, Trends, and Forecasts (2023-2028)

Key Highlights

• Factors such as an increase in oil consumption and the rising growth in oil-dependent industries are expected to drive the market in the long term. On the other hand, volatility in the oil market with prices below the shale gas production cost and increasing environmental concerns during shale gas production are two critical restraints in the market.
• Nevertheless, the new developments in shale gas production technology, like the advancements in horizontal drilling technology, are expected to make shale gas reservoirs more viable. This may provide an opportunity for market players.
• North America is expected to be the largest market in the forecast period, owing to its large-scale production of shale gas in the region. The United States is expected to lead shale gas production in the area.

Shale Gas Market Trends

North America to Dominate the Market

• The United States is the largest producer of shale gas in the world. Different countries, such as Brazil, Canada, China, and Argentina, have tried to emulate the American shale boom but have not been able to succeed. However, large progress has been made in China, but due to the difficulties posed by the unstable reservoirs, shale gas production may only rise slightly in the forecast period.
• Shale gas production in the United States increased by more than 70% in the previous seven years and reached 26,139 billion cubic feet (bcf) in 2021 from 15,213 in 2015. Shale gas production may increase further due to new wells being drilled across the country.
• While Canada is known to have significant conventional gas reserves, and the country was a key supplier of natural gas to the United States for decades until the recent shale boom in the country. However, with conventional natural gas sources in decline, Canada’s industry is turning to unconventional sources, including shale gas. Many oil and gas companies are now exploring and developing shale gas resources in Alberta, British Columbia, Quebec, and New Brunswick, which may balance the difference in shale gas production in the coming future.
• An Energy Information Agency (EIA) estimation shows that the US dry shale gas production in 2020 was about 850 bcm. The current scenario of the region may demand more natural gas supply during the forecast period, which may attract investment in the exploration and production of shale gas.
• Hence, North America is expected to dominate the market due to the overwhelming production of shale on the continent.

Increasing Environmental Concerns to Restrain the Market

• Methane gas emissions during the drilling process pose potential air pollution risks. Additionally, incorrect disposal of large volumes of chemically treated water used in hydraulic fracturing operations can potentially cause severe surface water contamination. This has attracted criticism from environmental protection bodies and NGOs around the world. Due to its impact on health and farming, local farmers and residents have repeatedly opposed hydraulic fracturing. ​
• Additionally, a typical fracking well requires approximately 2-10 million gallons of water during fracking operations, which puts additional strain on the water supply, particularly in drought-prone regions. ​
• In 2021, North America and Asia-Pacific recorded the world's highest carbon dioxide emissions. While Europe, the Middle East, and Africa tend to have the lowest emission.
• Recently in West Texas of the United States, where the Permian Basin (expected to drive the growth of shale gas activities in the United States) is located, shale gas companies faced opposition and criticism from the farmers due to the water shortage.
• The US Geological Survey (USGS) blamed shale gas activities for the increase in earthquakes in recent times in certain parts of the Central and Eastern United States that are well-known for oil and gas extraction. ​
• Thus, the increasing environmental concerns are expected to restrain the market during the forecast period.

Shale Gas Market Competitor Analysis

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