Shale gas refers to natural gas that is trapped within shale formations, as different from conventional natural gas resources, such as associated (produced with crude oil), or non-associated (without crude oil) natural gas that is found mostly in sandstone formations. Shales are fine-grained sedimentary rocks that can be rich sources of petroleum and natural gas. Over the past decade, the combination of horizontal drilling and hydraulic fracturing has allowed access to large volumes of shale gas that were previously uneconomical to produce. The production of natural gas from shale formations has invigorated the natural gas industry and the small inland refineries in the United States.
Figure 12.1 shows the EIA data and projections on dry natural gas production in the U.S., indicating the surge in shale gas production, while the conventional associated and non-associated gas production are expected to decline . Dry natural gas refers to natural gas that consists, essentially, of methane without any significant concentration of condensable hydrocarbons, such as propane and butane, that are present in natural gas liquids.