What is Shale?

Shale is a fine-grained sedimentary rock that forms from the compaction of silt and clay-size
mineral particles that we commonly call "mud". This composition places shale in a category
of sedimentary rocks known as "mudstones". Shale is distinguished from other mudstones
because it is fissile and laminated. "Laminated" means that the rock is made up of many thin
layers. "Fissile" means that the rock readily splits into thin pieces along the laminations.
Shale gas is defined as natural gas from shale formations. The shale acts as both
the source and the reservoir for the natural gas. Older shale gas wells were vertical
while more recent wells are primarily horizontal and need artificial stimulation, like
hydraulic fracturing, to produce. Only shale formations with certain characteristics
will produce gas. The most significant trend in US natural gas production is the rapid
rise in production from shale formations. In large measure this is attributable to
significant advances in the use of horizontal drilling and well stimulation technologies
and refinement in the cost-effectiveness of these technologies. Hydraulic fracturing is
the most significant of these.
Shale gas is considered to be unconventional gas, along with coalbed methane and
tight gas. The presence of shale gas has been known for a long time but its
economics of production were always questionable because of the low permeability
of the rock in which the gas is located. In other words, a given well would produce a
relatively small amount of gas which was not as economic as other wells. Advances
in hydraulic fracturing and horizontal drilling have improved the picture for shale gas.
Wells are now routinely drilled down and then horizontally, thus exposing the well
bore to a greater area. Combined with techniques to fracture the rock and thereby
free the gas, greater production is possible from a given well.

Advances in shale gas technology have resulted in large natural reserve additions,
particularly in the United States where the trend is more advanced. Indeed, the US
has seen net additions to its gas reserves in the last couple of years, following years
of decline.