A significant development in the oil and
 gas industry is the move away from 
 conventional sources of oil and gas to a focus, locally, on coal-bed methane and, more recently, shale gas, explains petroleum 
industry body Petroleum Agency South Africa (Pasa) CEO Mthozami Xiphu.

Pasa will continue to monitor exploration of coal-bed methane under the rights 
granted to the agency. 
Further, the agency will keep an eye on studies for shale gas in the southern Karoo, while monitoring exploration in shallow offshore areas of South Africa. 
Pasa will start ultradeep oil and gas exploration off the West Coast. 
South Africa also has operators who are looking at exploiting gas from old gold-exploration boreholes in the Free State goldfields.

The agency expects offshore exploration to become busier and hopes to monitor exploration activity, such as seismic acquisition and drilling, and incorporate the results into its understanding of the petroleum geology of South Africa, he explains.

“A new offshore development for the agency 
is its first application in ultradeep water 
exploration. 
“Globally, shale gas seems to be gaining prominence. In the US, shale gas supplies over 6% of the domestic gas requirement and has decoupled the oil and gas prices,” Xiphu says.

He points out that, as the world’s oil 
reserves deplete, gas will come into its own. 
There are very large resources of gas that have not been exploited and gas is a relatively 
clean and convenient fuel. 
In South Africa, State-owned oil and gas company PetroSA sees the shorter-term use of gas for power generation.

The Oil & Gas Africa 2010 exhibition aims to develop and expand services to operators in Africa. Issues at the event include services and infrastructure, procurement of equipment and supplies, financing and the implementation of technology.

As an exhibitor at the event, Pasa aims to create awareness of the agency among companies that service the local upstream industry, as well as new and prospective entrants in this field. 
The agency, with strong ties to the South African Oil and Gas Alliance, wants to act as facilitator between service companies and operators. 
The exhibition enables local service companies to network with upstream companies.

The agency is sponsoring five companies, owned by black empowerment individuals, to exhibit at the event to enable them to benefit from the business opportunities generated.

Using the event to strengthen its network of operators and service providers, the agency 
will use such links to encourage a strong focus on study courses and careers for youth in the upstream oil and gas industry.

Shale Gas
High energy prices and advances in fracturing technology enable shale gas production to become economically viable. However, the 
accurate prediction of gas concentrations, partition behaviour and rock properties ahead of drilling becomes necessary to reduce risk for investors, reports Brian Horsfield, Hans-Martin Schulz and Maarten de Wit in their paper presented at the South African Geophysical Association technical meeting and exhibition, held in Swaziland, last year.

The paper indicates that there is a lot of scientific study that needs to be done on how shale gas systems work and there are significant opportunities for advancing science and technology as a result of the studies.

Unconventional gas production could 
increase from 42% of total US gas production in 2007, to 64% in 2020.

Shale gas represents extremely large natural gas reserves and the US has produced only a fraction of the shale wells’ potential, the American Petroleum Institute website states, quoting 
research done in the US.
World reserves of shale gas are estimated 
at 16 000 trillion cubic feet (Tcf).

To give this number perspective, the yearly natural gas production from shale gas reservoirs in the US is about 1 Tcf, or 6% to 10% of total natural 
gas production in the US, and comes from more than 40 000 shale gas wells, Horsfield, Schulz and De Wit say.

Shale gas is defined as natural gas produced by shale formations. Shale is a type of sedimentary rock formed from clay.

The shale acts as both the source and the reservoir for the natural gas. About 500 Tcf of shale gas is forecast for Europe and targets include the Posidonia shale (formed during the Jurassic period), Alum shale (Cambrian), Wealden shale (Cretaceous), Mikulov formation (Jurassic) and the Riga formation (Silurian).

About 200 Tcf of shale gas potential is forecast for sub-Saharan Africa.

For South Africa,
specifically, the Whitehill and Prince Albert formations and its equivalents (Permian) are the best areas for exploration. 
These formations are organically rich, but thermal maturity could possibly be used to distinguish between gas shale and oil shale deposits.

The Barnett and Marcellus shale plays in the US both have advanced thermal maturity and researchers believe that this is a prerequisite for high gas-in-place and high gas flows to be maintained.
Basalt rock formations in the Karoo help geologists to define the maturation history of the area and its deposits. 
Very high maturity levels have been 
documented in the cores of the Whitehill formation.

Shale gas is a natural gas from shale formations. The shale acts as both the source and the reservoir for the natural gas. Older shale gas wells are vertical, while more recent wells are primarily horizontal and need artificial stimulation, like hydraulic fracturing, to produce gas.

Only shale formations with certain characteristics will produce gas, research indicates.
The most significant trend in US natural gas production is the rapid rise in production from shale formations.

This is because of significant advances in the use of horizontal drilling and well stimulation technologies and refinement in the cost-effectiveness of these technologies.

Hydraulic fracturing is the most significant of these.