Arguments in favour include improving energy security, reducing the cost of energy and providing jobs e. But fracking is highly controversial in the UK, prompting significant protests at earmarked sites by local residents and anti-fracking groups. The main concerns are about water, air, noise and traffic pollution, and harm to landscapes and the natural environment, particularly in parts of the countryside renowned for their natural beauty, including protected areas the Government granted permission for fracking to occur 1,m below national parks and other protected sites in December The application of horizontal hydraulic fracturing fracking to shale rock formations contributed significantly to this increase in supply, as the technique boosted natural gas production yield by more than 25 percent over this period.
Since , the PPI for natural gas has exhibited marked volatility. Chart 1 presents an indexed view of natural gas prices and domestic natural gas production from through Since shale gas has been a key player in domestic natural gas production for only a few years, and because it has been tracked over a relatively short period since by the Energy Information Administration EIA , analysts find that it is difficult to quantify precisely the effects that shale gas has had on natural gas prices.
However, data indicate that increasingly higher natural gas prices during the first half of lured additional shale gas to the market. As natural gas prices peaked in July , drilling activity as measured by rig counts hit an all-time high. In turn, lower prices can erode incentive for drilling, which eventually results in decreased production.
In September , the natural gas rig count peaked at 1, rigs; but by November , the total rig count fell However, despite the slowdown in drilling activity, overall production has continued to rise, due to expanded horizontal hydraulic fracturing to shale rock formations. In terms of demand, domestic consumption increased 9.
As the price of natural gas fell relative to that of coal, the electric power generation sector increased natural gas consumption and reduced coal consumption. Examining growth in shale gas production may shed further light on the downward trend in natural gas prices. EIA data show domestic natural gas production increased After , the role of shale gas expanded, while extraction from all other sources shrank.
From to , yearly natural gas production less shale gas production decreased In , production from shale formations increased Shale production in was approximately 8.
Chart 2 highlights the increasingly substantial role shale gas plays in the domestic natural gas market. In addition, EIA notes the expanded role shale gas is expected to have in the future.
Annual Energy Outlook projects that U. Chart 3, derived from Annual Energy Outlook , illustrates the important role shale gas is expected to take. Note: Data for — are projections. Source: Energy Information Administration. Between and , U. In the future, shale gas production is expected to increase, while every other extraction method likely will remain steady or decline.
Increased availability of affordable natural gas also may have an influence on the broader energy market. Eventually, affordable, compressed natural gas could compete on a wider scale with diesel fuel to power commercial and mass transit vehicles.
With the potential combination of low prices and high-production levels, natural gas has a promising future in the domestic energy market. Following a 0.
The index for finished goods less foods and energy increased 0. See chart 4. Leading this reversal, the index for intermediate goods less foods and energy climbed at a faster rate than it had from September to December, while prices for intermediate energy goods fell at a much slower rate from December to March, compared with the prior quarter.
However, the index for intermediate foods and feeds declined at a faster rate in the first quarter. In contrast to prices for more highly processed finished and intermediate goods, the index for crude materials for further processing fell 2. This downturn was broad based, with prices for crude energy goods in particular, natural gas and coal , crude foodstuffs and feedstuffs , and crude nonfood materials less energy decreasing following advances in the previous quarter.
Following a 9. The Middle Devonian Marcellus Shale in the Appalachian basin extends from central Ohio on the west to eastern New York on the east, and from north-central New York on the north to northern Tennessee on the south.
Its thickness ranges from 0 feet ft where it pinches out to the west to as much as ft in its eastern extent. Within the Broadtop The U. The Marcellus Shale was assessed as a continuous gas accumulation using a methodology identical to that used in the assessment of shale and other continuous-type assessment units throughout Geological Survey USGS estimated a mean undiscovered natural gas resource of 84, billion cubic feet and a mean undiscovered natural gas liquids resource of 3, million barrels in the Devonian Marcellus Shale within the Appalachian Basin Province.
All this resource occurs in continuous The Marcellus Shale is a sedimentary rock formation deposited over million years ago in a shallow inland sea located in the eastern United States where the present-day Appalachian Mountains now stand de Witt and others, This shale contains significant quantities of natural gas.
New developments in drilling technology, along with higher The Marcellus Shale and Point Pleasant-Utica Shale formations of the Appalachian Basin contain an estimated mean of trillion cubic feet of undiscovered, technically recoverable continuous resources of natural gas, according to new USGS assessments. Geological Survey. Using a geology-based assessment method, the U.
Geological Survey estimated a mean undiscovered natural gas resource of 3. The Marcellus Shale contains about 84 trillion cubic feet of undiscovered, technically recoverable natural gas and 3. Map of the Appalachian Basin Province showing the three Marcellus Shale assessment units, which encompass the extent of the Middle Devonian from its zero isopach edge in the west to its erosional truncation within the Appalachian fold and thrust belt in the east.
The assessment unit map for the Marcellus Shale within the Appalachian Basin. Although it occupies similar areas as the Point Pleasant-Utica Shale, the Marcellus is much younger, having formed in the Devonian age.
Storage tanks for produced water from natural gas drilling in the Marcellus Shale gas play of western Pennsylvania. A Marcellus Shale outcrop in Highland County, Virginia, shows at the surface the object of shale gas development drilling in nearby states.
As the commercial success of the Barnett Shale became apparent, other companies started drilling wells in this formation, and by , the Barnett Shale was producing almost half a trillion cubic feet Tcf of natural gas per year. As natural gas producers gained confidence in their abilities to profitably produce natural gas in the Barnett Shale and saw confirmed results in the Fayetteville Shale in northern Arkansas, producers started developing other shale formations.
These new formations included the Haynesville in eastern Texas and north Louisiana, the Woodford in Oklahoma, the Eagle Ford in southern Texas, and the Marcellus and Utica shales in northern Appalachia. Click to enlarge More data. The NGPA established tight natural gas as a separate wellhead natural gas pricing category that could obtain unregulated market-determined prices. The tight natural gas category gave producers an incentive to produce high-cost natural gas resources when U.
As a result of the NGPA tight natural gas price incentive, these resources have been in production since the early s, primarily from low-permeability sandstones and carbonate formations and from a small production volume of eastern Devonian shale. With the full deregulation of wellhead natural gas prices and the repeal of the associated Federal Energy Regulatory Commission FERC regulations, tight natural gas no longer has a specific definition, but it generically still refers to natural gas produced from low-permeability sandstone and carbonate reservoirs.
The United States has access to significant natural gas resources. Energy Information Administration projects that the majority of U. Page updated October 18; Monthly dry shale gas production chart updated on October 20, Natural gas explained Where our natural gas comes from.
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