Water shortages could limit shale gas development

Water shortages pose a big threat to the global shale oil and gas industry, a new report claims.

More than a third of commercially viable shale gas deposits worldwide are in areas that are either dry or have water supply constraints, environmental think tank World Resources Institute said.

The process of extracting gas and oil from shale rock deep underground – known as fracking – requires huge amounts of water.

Out of the 20 countries with the largest shale gas resources, eight have deposits in areas that are “arid or face high to extremely high water stress”, including China, Algeria, Mexico and South Africa.

Overall, 38% of viable shale gas deposits worldwide are in areas where water supplies are a potential problem.

Andrew Steer, President and CEO, WRI said: “Water risk is one of the most important but underappreciated challenges when it comes to shale gas development.

“This analysis should serve as a wake-up call for countries seeking to develop shale gas. Energy development and responsible water management must go hand in hand.”

The report suggests conducting water risk assessments to understand availability and reduce business risk as well as minimising freshwater use.