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The US shale gas and tight oil revolution is rightly hailed as a triumph for the industry. What is often less widely appreciated is the key role the government played in laying the foundations for the crucial commercial breakthroughs in hydraulic fracturing and horizontal drilling.

As set out in a Breakthrough Institute paper from 2012, contributory factors included financial support for R&D and pilot projects, tax credits for innovative operations, and oilfield technologies first developed in government laboratories. Those strategies, in some cases pursued over decades, were critical for making the eventual shale boom possible.

Now the Trump administration is talking to the US industry about opening a new chapter in the story of shale. It may not be quite as dramatic as the initial breakthroughs in unconventional resources, but it would have almost equally wide-ranging implications.

Speaking at a meeting of the National Petroleum Council (NPC) last week, Kyle Haustveit, the assistant secretary of energy and head of the department’s newly renamed Hydrocarbons and Geothermal Energy Office, set out its policy priorities and goals for the next few years. The first item on his list was doubling recovery factors for US unconventional resources.

“Today for oil reservoirs we recover roughly 10% of the oil in place,” he said. “We can repeat the shale revolution with the resource we’ve already characterised, the wells we’ve already drilled, through the infrastructure that’s been built.”

It was not an idle pledge from an uninformed politician. Assistant Secretary Haustveit is a professional petroleum engineer who before going into government worked at Devon Energy in various technical and leadership roles. He led teams developing and commercialising diagnostic techniques that are used to optimise hydraulic fracturing and resource development around the world. He is undeniably qualified to lead a government effort to work with the industry to improve those operations.

The 10% average recovery factor for US tight oil is low by the standards of the global industry. Conventional oil recovery factors are typically around 30% to 35% of the original oil in place, and can get as high as 60% to 70% with Enhanced Oil Recovery and advanced secondary or tertiary recovery methods such as gas injection and chemical flooding.

As Haustveit said at the NPC meeting, his goal of improving recovery in unconventionals is well aligned with the latest thinking in the US industry. This year there has been a noticeable upturn in operators’ interest in raising recovery factors.

Darren Woods, chief executive of ExxonMobil, was one of the first industry leaders to highlight this point. He said at a conference back in 2023 that he had set a challenge to the company to double recovery factors, and to find technologies that could unlock that.

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Chevron has similarly been emphasising its commitment to improving recovery with its own proprietary technologies. Mike Wirth, its chief executive, said in an interview in October that "the biggest opportunity is to recover more of the molecules that are in the ground”.

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But doubling overall recovery does not necessarily mean doubling the production from each well. Instead, it is most likely to mean a combination of productivity gains and cost reductions that make it commercially viable to drill more wells, particularly in lower-quality acreage, to double recovery from the entire basin.

For the industry as a whole, improving recovery is more likely to extend production for longer than to deliver a short-term surge in output. It could nevertheless be highly significant for the US economy and national security.

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For companies operating in US tight oil, it is not really a question of whether they should spend time and resources to pursue improved recovery. It is a strategic imperative that they do.

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Increasing EOR type of operations to recover more hydrocarbons can be capital intensive initially with infrastructure buildout, but it would also mean continued jobs, longer term production, and the after capital operating costs per barrel can actually be pretty low to make it economical. Probably not at $50/bbl, but as you get up to $70/bbl or so, it becomes more attractive.