It is expected that half of the natural gas produced in the U.S. will be coming from unconventional sources by the year 20301 including very tight sand and shale plays.  In 2005, the majority of U.S. gas shale production came from four different basins2; San Juan Basin in New Mexico/Colorado (55 MMSCF/D), Antrim Shale in Michigan (384 MMSCF/D), Appalachian/Ohio Shales (438 MMSCF/d), and Barnett Shale, Fort Worth Basin, Texas (1,233 MMSCF/D).  There are also several other Shale plays that are being explored and proven to have significant reserves.  These plays include Devonian Shale in Appalachian Basin; the Mowry shale in the Powder River Basin; the Mancos shale in the Uinta Basin; the Woodford shale in Ardmore Basin, a Floyd/Neal shale play in the Black Warrior Basin; the Barnett shale in the Permian Basin; the New Albany shale in the Illinois Basin; Eagleford Basin, and others3.

The gas production from shale plays is primarily accomplished through a hydraulic fracturing operation of the horizontal wells.  Shale reservoirs are typically natural fractured and very tight with permeability measured in nano-darcies.  Hydraulic fracturing is required to interconnect these natural fractures with the horizontal wellbore by injecting significant amounts of water.  After the fractures are created, the water is typically flowed back to the surface, but not more than 20-25% of fracturing fluids are recovered; the rest is spread into the reservoir.  Experience with the current shale plays indicates that for certain cases the wells still produce water long after the fracturing operation.  Moreover, the formations below or above the shale formations may have water.  During fracturing operations, the fractures may extend to water bearing formations and result in continuous water production through the well.  Even worse, fracturing in one well can interfere with the production operations of the neighboring wells by accelerating the loading problems along the lateral section.

Water can naturally be present in oil and gas formations. In some shale formations, water is mixed with the gas in the formation.  This water needs to be removed to be able to produce the gas.  Barnett shale gas wells can produce significant amounts of water.  U.S. Geological Survey data indicates that some gas wells can produce 39 barrels of water per thousand cubic feet of gas (bblw/MSCF).  In Denton County, gas wells produce even more water up to 53 bblw/MSCF gas.  Devon Energy reports that in its Barnett Shale wells, some amount of water is produced for the life of the well with the amount produced varying from trace amounts to 400-500 Bbl/Day.  One company producing gas from the New Albany shales in the Illinois basin has reported that the peak gas production from their wells are achieved after 6 to 12 months of dewatering.  The Antrim shale in Michigan also contains water that must be removed in order to achieve maximum production.

Oil production from oil-shales has been increasing significantly in recent years.  Some of the gas producers are transforming into oil producers primarily due to market forces.  Most wells to produce oil are drilled horizontally, and there is much that resembles the issues associated with shale gas horizontal wells.

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