The US shale boom has been met with mixed reaction in the GCC, with senior figures either dismissing its significance, or, in the case of billionaire Prince Alwaleed, warning of its consequences.
But while the region has yet to be directly affected, the rise of shale energy is not an event governments can afford to ignore.
“The US shale gas boom has transformed the global energy equation,”  says Vishnu Sankaran, associate director and head, chemicals and materials practice, Middle East, North Africa and South Asia, Frost & Sullivan.
“The low cost of natural gas , once considered a prerogative of the GCC, has been turned on its head by the shale gas boom. The US has suddenly become extremely competitive due to lower electricity costs powered by natural gas.”
The resulting cheap and abundant supply of ethane, also means the US petrochemicals industry is now capable of challenging low-costs in the GCC, according to Sankaran.
In November an IEA report said the United States’ booming shale output would see the country surpass Russia and Saudi Arabia as the world’s top oil producer by 2015,  reaching 11.6 million barrels a day in 2020.
In contrast Saudi oil production is forecast to fall to 10.6 million bpd by 2020 from 11.7 million in 2012.
Despite these predictions, the impact so far has been limited, says Robin Mills, author of ‘The Myth of the Oil Crisis’ and ‘Capturing Carbon’.
“But higher US oil supplies have kept the oil price from rising. And Qatar has had to divert LNG to Asia, although prices have remained strong.”
There has also been some restraint on spending growth in the region to lower vulnerability to oil price decreases.
However, the shale boom is not all bad news for the GCC, with several local players eyeing investments in anticipation that a US export ban on natural gas will be lifted.
Qatar Petroleum International (QPI) and ExxonMobil unveiled plans last year to develop a $10 billion export terminal at Golden Pass in Texas, US, and signed a MoU to cooperate on unconventional gas opportunities in North America.
QPI also completed the $981 million acquisition of natural gas fields from Canada’s Suncor Energy in September with British partner Centrica.
Saudi Arabian petrochemical giant Sabic said it was in talks with a number of US companies for investment in shale gas.
While UAE Oil Minister Suhail bin Mohammed Al-Mazroui has said the country is considering investments in the US and Canada through state owned energy company Mubadala Petroleum.
“Shale gas will be influencing energy markets for years to come, while we are no longer early in the boom we are at a stage where investments in technology and exploration by larger companies will drive increased recovery rates and more exploration,” says Mason Ellery Husky, senior commodities trader at Lannister Knight DMCC.
SHALE IN THE GCC
Although there has yet to be an in-depth assessment of the region’s shale resources, some GCC nations have begun exploring their own unconventional deposits, with the aim of meeting domestic needs.
A report from IHS forecasts that natural gas demand in the region will rise from 256 billion cubic metres in 2011 to 400 billion in 2030.
Oil demand is also set to grow more than 50 per cent to 2030 from around 4 million bpd to over 6.2 million, according to the consultant.
“There is a tremendous opportunity for countries with significant shale gas deposits to be able to profitably replace more polluting fuels and grow their economies at the same time,” says Husky.
Oman has made significant progress in developing its unconventional deposits having signed a 30-year gas production sharing and sales deal with BP in December to develop the $16 billion Khazzan tight gas project.
The project aims to serve a third of Oman’s domestic gas needs, delivering plateau production of one billion cubic feet of gas per day and 25,000 bpd of gas condensate light oil. Construction is set to be begin this year with the first gas expected in late 2017.
The UAE has invested $10 billion in the Shah gas project, which is due for completion in 2015 . The joint venture between Occidental and Adnoc will produce 500 million cubic feet of gas per day by stripping it from sulphur. This follows the awarding of a 40 per cent stake in the ultra sour Barb gas project to Royal Dutch Shell in 2012, a project forecast to produce 520 million cubic feet of network gas per day.
Even oil rich Saudi Arabia has plans.  Aramco chief, Khalid Al Falih, confirmed in October that the country was ready to start producing its own shale gas  and unconventional resources over the next few years to meet domestic needs.
Reports suggests Aramco is being forced to sell oil at a cut price $4 a barrel to fuel Saudi’s power plants, due to a gas shortage that is also impacting power generation in other GCC countries, excluding Qatar.
Saudi oil minister Al Naimi said that the country has 600,000 trillion cubic feet of unconventional shale gas,  according to rough estimates – the fifth largest reserves in the world. Initial steps saw Aramco tap around seven shale gas test wells in 2013.
“It will still take a few years before gas deposits are accurately mapped, the relevant technology acquired, and most importantly, the critical issue of water supplies needed in vast quantities for hydraulic fracturing is addressed,” says Sankaren.
Water could be the main hurdle for shale production, with 4.1 million to 5.6 million gallons used per fractured well in Pennsylvania and Virginia, US, according to a study by Downstream Strategies and San Jose University.
Plans are therefore likely to be dependent on the development of technology allowing the use of recycled water, seawater or liquefied petroleum gas.
Subsidised GCC gas prices  may also limit development. A Reuters analysis of Saudi’s plans highlights that even with innovations in the US, shale production costs around $4mmbtu, far in excess of the $0.75mmbtu fixed gas price in Saudi.
“Shale gas, along with tight gas, can certainly be part of the solution in Saudi Arabia, Oman and possibly other countries. But they also need progress on energy efficiency,” according to Mills.
Yet as is often the case in global energy, politics could prove to be the deciding factor in the next chapter of shale development.
“The Ukraine situation  will encourage the US to push ahead with LNG exports and possibly remove the ban on crude oil exports,” says Mills.
EU nations too are evaluating their dependence on Russia for gas  and looking for new energy sources.