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Published: April 2013
While world energy demand continues to increase, alternative forms of energy such as water, wind and solar power are making slow and specialized headway in easing carbon emissions from traditional fossil fuel–derived manufacturing. Countries are developing readily available, relatively clean-burning natural gas to meet their energy requirements. Moreover, in recent years, advances in horizontal drilling and hydraulic fracturing (unlocking natural gas from shale formations) hold the prospect of making substantial contributions to the world natural gas supply portfolio.
World natural gas consumption over the twenty years from 1992 to 2012 increased 67%, equal to the increase in production. Natural gas consumption is estimated at 24% of world energy sources, with coal and oil together holding about a 63% share (30% coal, 33% oil). By contrast, all noncombustible and other renewable sources (nuclear, hydraulic, biomass, thermal and wind) hold about a 13% share. In the United States, the natural gas energy share has advanced rapidly as pricing ratios have fallen, such that oil-based fuels are currently five times more expensive per energy unit (Btu). As a result, natural gas has risen to more than a 27% share of US energy consumption, up from 25% just two years ago, with the other major forms still oil and coal.
North America was the largest natural gas–consuming region in 2012 with about 27% of the world total, followed closely by Central and Eastern Europe with about 21%, and Asia and Oceania with 19%. Consumption in Asia, Oceania and the Middle East has grown significantly in the past decade and is forecast to continue to develop through 2017.
The following pie chart shows world consumption of natural gas:
Hydraulic fracturing or "fracking" is the gas production process for extracting natural gas from shale rock layers more than a mile deep in the earth. Fracking makes it possible to extract natural gas from shale formations ("plays") that were once extremely difficult to reach with conventional technologies. Advances in drilling technology have led to new man-made hydraulic fractures in shale plays that were once not available for exploration. In fact, three-dimensional imaging helps scientists determine the precise locations for drilling.
Horizontal drilling (along with traditional vertical drilling) allows for the injection of highly pressurized fracking fluids into the shale area. This creates new channels within the rock from which natural gas is extracted at higher than traditional rates. This process can take up to a month, as drilling delves more than a mile into the Earth's surface, after which the well is cased with cement to ensure groundwater protection, and the shale is hydraulically fractured with water and other fracking fluids.
Groundwater protection remains the critical goal necessary to the success of well operation. The well design, casing, and the inherent risk associated with the hydraulic fracturing process itself all factor into new shale gas well development.
The current success of the shale oil and gas industry in the United States is due to the private ownership of the majority of the oil and gas mineral rights and the entrepreneurship of small, independent companies who succeeded in developing the technology. An area of concern is the environmental impact of the more recent techniques for obtaining shale-based natural gas and possible underground/groundwater contamination. Some have argued that these practices can lead to impacts on human health and the environment as a whole. During 2010 the U.S. EPA requested that several companies using hydraulic fracturing (fracking) disclose data on the chemicals used in the fracking process, to determine whether fracking has an impact on the water quality for those residents living in the vicinity of hydraulic fracturing wells. The EPA continues to investigate fracking methods, fracking operating procedures, chemicals used in the process, environmental impact and human health consequences. In addition, as fracking involves huge amounts of water supply, there are concerns about the local supply of water. But because hydraulic fracturing has mostly occurred on private lands in the United States, with decades of experience behind it, landowners have incentives to balance environmental concerns with income from energy production.
Outside of the United States, the majority of the mineral rights are owned by governments, who are slow at adapting to the emergence of this sector and concerns from nearby residents. As well, outside of the United States, little geological information exists about shale deposits; whether such plays are suited for hydraulic fracturing technology is generally not known. This makes the large investment decisions required in these world regions all the more complicated. In the United States more pertinent information is available, which encourages development, the result being that the United States has become the largest shale gas producer in the world.