How should water resources be allocated for shale gas development? An exploratory study in China

Abstract

Water scarcity has emerged as one of the most important global challenges of the twenty-first century. With rising demand for energy, and water being a critical input in energy production, the availability of water resources has put energy sustainable production under growing strain. While unconventional natural gas (especially shale gas) is seen as an important bridge for promoting the transition of energy system from high to low carbon, water availability is a significant constraint on the development of energy resources owing to the massive quantity of water used by the hydraulic fracturing. Against this background, our study aims to optimize the allocation of regionally scarce water resources for fostering integrated economic, social, and environmental growth in shale gas development plays. In light of the uncertainty inherent in the water supply management system for shale gas development, this work employed the Interval Two-stage Stochastic Programming (ITSP) to establish an optimal allocation model for water resources between wells jointly dispatched by surface water, underground water and reused water. The model predicted water scarcity, optimal water allocation, and the total benefit of the shale gas development water supply system under various scenarios. Furthermore, when compared to the Two-stage Stochastic Programming (TSP) model results, it was found that the ITSP model's interval value may present decision makers with more ideas and options than the TSP model. In addition, since the ITSP model is oblivious to the system risk issue, it incorporated robust optimization into the original ITSP model to build the Interval Two-stage Robust Stochastic Programming (ITRSP) model. Our findings were expressed as intervals that more accurately represent the actual optimal allocation of water resources, which also provided a broader decision-making space for decision makers in managing shale gas development water supply management schemes.