US natural gas shale plays threaten Canada export market

Natural gas shale plays in Canada and the US look set to skew the traditional supply and demand dynamics between the two countries. Pauline McCallion looks at the implications and potential alternative routes to market for Canada

Shale gas discoveries in the US and Canada have been a game-changing factor in the recent development of the North American natural gas industry. Whereas concerns once centered on lack of supply, now the talk is of the massive oversupply facing the market, as well as reduced demand from US industries that have been hit hard by the recession.

Shale gas is an unconventional resource; a hydrocarbon-rich rock formation requiring the use of expensive drilling techniques, such as horizontal drilling