The International Energy Agency (IEA) currently estimates unconventional-gas reserves in Europe – including tight gas, shale gas and coalbed methane – to be around 3500 trillion cubic feet. This would be sufficient to supply European gas demand for more than 60 years. However, there are some significant hurdles to be overcome if shale gas is to have as profound an effect on the energy market in Europe as it has had in the US.

The industry faces several practical challenges. Drilling costs are higher in Europe. European shale gas deposits are generally deeper underground and harder to extract. The oil services industry is less developed than in the US, with a shortage of rigs and qualified personnel. Europe does not have the existing pipeline infrastructure that the US does. All of these factors will have gradually less impact as the industry develops, the understanding of the region’s geography improves, advances in technology reduce costs and infrastructure is put in place. Higher European gas prices - around twice those in the US - will also help overcome many of these challenges.

In addition, whilst in the US subsoil rights are generally in private ownership (and often held by the owner of the surface land), in most European countries subsoil rights are usually owned by the State, which is entitled to receive royalties in respect of gas that is generated. Local landowners in the US are therefore more likely to support shale gas operations, for financial reasons, than in Europe where there is not such an incentive. Conversely, the exploitation of shale gas reserves in Europe is likely to be a more politicized issue. These impediments may be offset, 'though, by the higher gas prices in Europe.

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