High capital expenditure, lesser productivity has caused oil majors in shale plays to complain of diminishing returns to capital.Barclays said in a report that technological breakthroughs could help make the projects more economical."Service companies outlined major technological breakthroughs, some of which are already commercialised or will be commercialised in the next two years. Schlumberger is focusing on making the fracturing process more efficient...Technologies including BroadBand and HiWAY will help improve recovery rates by improving how operators target the most productive parts of the wellborne which will improve the economics," Barclays report said.

Eagle Ford, Bakken are witnessing increae in productivity but services costs of US companies have reached record high levels on a nominal basis.

Although the future appears bright for onshore development, the next 1-2 years may be markedly softer for offshore field services than the past couple years due to slower growth in deepwater developments. High service costs in this market, coupled with political and local content-related delays in Brazil and West Africa, are reducing activity. As service companies standardize their offerings, costs can fall, but the most acute cost inflation has
been in the subsea portion of offshore field development, which represents about 10-15% of the field’s development cost.

Finally, though the development of shale and tight oil outside of the US and Canada is expected to be slow, operators are already applying the technologies that have been commercialized and perfected in North America.
Source: Barclays