The latest wave of innovation could greatly improve production and lower costs.
The production of shale gas and light tight oil using hydraulic-fracturing (fracking) technologies has revolutionized the US energy industry. However, the data show that it takes a large number of wells—as many as 1,500—to reach peak production for each new basin, because optimizing fracking remains largely a matter of trial and error (exhibit). Over the next decade, our research suggests, several promising techniques could boost the precision of drilling and fracking, increasing the production of light tight oil and shale gas significantly—for the former, by nearly 40 percent in the United States alone. At the same time, these techniques could substantially lower costs and open up new regions to production.
Improved geological data, combined with better modeling techniques, for example, could increase individual well productivity and shorten learning curves. New technologies would allow more wastewater to be treated and reused rather than disposed of. Better IT tools could improve performance across the value chain (for instance, in supply chains and logistics). Finally, advances in nonwater fracking technologies, such as high-pressure gases, could make it possible to frack in water-constrained regions (notably China) while lowering production costs. Opportunities such as these underscore the potential of process innovations to yield continuous improvements even in breakthrough technologies, like fracking.