Analysis of the Potential Economic Viability of Shale Gas Resources in Europe

European countries are currently exploring strategies to ensure a strong level of security of energy supply while decreasing its reliance on natural gas imports. With the strong surge in shale gas developments in the USA, similar ambitions have been the ongoing subject of inquiry in Europe. Detailed knowledge about extraction costs is a key issue in determining future shale gas investments in Europe. The paper at hand analyses the potential of European shale gas resources, highlighting their competitiveness against conventional natural gas. It examines the current volume of shale gas resources in Europe and performs a detailed cost calculation to provide an estimation of shale gas production costs. The results indicate that under current market conditions the repetition of the US shale gas boom is by all measures improbable in Europe. Furthermore, in the case that natural prices were to return to historically higher levels, only a few highly productive shale gas formations would be economically competitive.