Shale oil is unconventional oil, which is found between the layers of shale rock and is being extracted using hydraulic fracking and horizontal drilling technique. The use of these techniques has considerably increased the production of oil and gas from shale rocks. Oil shale is an organic material having finely grained rock particles from which shale oil is primarily being extracted. This oil is being used as a substitute for crude oil and is also used in the production of commercial products such as sulphur and ammonia. Moreover, it is used as an unconventional source of energy, as the conventional energy sources are depletion.
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The cost associated with the extraction of shale oil is comparatively higher as compared to crude oil extraction and it has huge environmental impact such as water pollution and others. Shale oil is extracted by using underground and surface mining, after which it goes through the retorting process where the rock is exposed to high temperatures in the absence of oxygen. The chemical reaction results in the liquefaction of kerogen, which is the fossil fuel present in the shale.
The global shale oil market is expected to grow at a CAGR of 16.4% during the forecast period. Shale oil is primarily being used by various industries such as chemical industry, fuel industry and others, as a fuel to drive steam turbines by thermal power plants. The requirement of water in the extraction of shale oil is considerably higher and thus, it increases the salinity of water. The process of heating shale rock in the extraction process results in the emission of greenhouse gases such as CO2.
The production of shale oil requires lesser time compared to crude oil and it also breaks the monopoly of the oil exporting countries. The extraction process helps in providing employment to a large number of people, thereby improving the economy. During the process of hydraulic fracking water and chemicals are use that results in contamination of water.
The global shale oil market has been segmented on the basis of process, technology, product, and application. Based on the product type, the market is segmented as kerosene, heavy oil, gasoline, diesel, and gases such as propane and butane. Based on the technology, the shale oil market has segmented as in-situ and ex-situ. These technologies are primarily being used during the extraction of the shale oil. Among which, in-situ technology is expected to dominate the market during the forecast period. In this technology the heat is directly applied to the shale rocks underground, whereas ex-situ process is done above ground surface.
The regional is segmented as North America, Europe, Asia Pacific, Latin America and Middle East Africa. The North America region has the highest market for shale oil, as US is producing the majority of the total shale oil produced globally. The countries in North America region are producing shale oil at a commercial scale.
The major players in the shale oil market are BP, Chevron, ConocoPhillips, Electro-Petroleum, Inc., Exxon Mobil, Fushun Mining Group, Mountain West Energy, LLC, Petrobras, Royal Dutch Shell, Statoil, and others. Various players are adopting strategies such as joint ventures, partnerships, mergers and acquisitions, and others to expand the market and gain competitive advantage over others. For instance, in 2019, Chevron Corporations, an American multinational energy corporation, is planning to acquire Anadarko Petroleum Corporations, for gaining larger market share and competitive advantage over others.