For all of the gripes about the volume of water used in shale gas fracing, what’s often overlooked is just how much water it takes to make, say, a Coke.

In 2010, natural gas drilling consumed 79 million gallons of water per day (GPD) from the Susquehanna River Basin, which delivers about half of the fresh water that flows to the Chesapeake Bay.

In 2009, after Coca-Cola cut its annual water use by an impressive 2.9%, it still drank up 224 million GPD. For the year, Coca Cola turned 81.6 billion gallons of water into 34.3 billion gallons of beverages.

Still, the perception of fracing as a water hog is likely to prompt changes for the shale industry and cost operators a bundle, said Melissa Stark, author of a Dec. 10 Accenture (NYSE: ACN) report on water and shale gas development.

New Environmental Protection Agency (EPA) regulations are likely on the horizon, regardless of whether the agency finds a link between water contamination and fracing. New rules could significantly drive up costs for operators. And growing competition for freshwater is also likely to impact how many wells are drilled, Stark said.

To maintain an edge and survive a stricter regulatory climate, the industry should take steps to improve water management, Stark said. Lessons already learned domestically will also help companies as they begin to exploit resources in other countries, such as Poland and China.

“Successful oil and gas operators will be those that understand the local water challenges, leverage (experience) from the U.S. plays and develop the right water sourcing, use and reuse, treatment, disposal and supply-chain strategy,” said Stark, managing director for Accenture's energy industry group.

Water consumption has been widely criticized and publicized, especially as shale gas production has increased. Fracing can require 3-5 million gallons per well, though some require even more.

But Stark points to Pennsylvania water use, where state annual consumption totals about 3.6 trillion gallons. The shale gas industry uses less than 0.2% of that for hydraulic fracturing.

Significant resistance to shale gas development due to water and emission concerns is already prevalent in many parts of the United States and Western Europe, Stark said. France and Bulgaria, for instance, have nationwide moratoriums on fracing, in part tied to water concerns.

Advances in the industry — including reductions in water use — have created their own problems. With technology evolving so quickly, the industry has outpaced the data regulators’ need to develop guidance.

And guidance is on the way.

Stark views the shale gas industry as governed by a patchwork of existing oil and gas regulations, combined with environmental regulations on water and air management.

“This loose regulatory landscape is beginning to change with growing state and federal attention,” she said.

The American Petroleum Institute said in March that comprehensive state, local, and federal laws address nearly every aspect of fracing-related exploration and production.

“These include well design, water use, waste management and disposal, air emissions, surface impacts, health, safety, location, spacing and operation,” API said.

And the EPA itself said in a 2004 study that hydraulic fracturing posed minimal threat to underground sources of drinking water.

Stark surmises that won’t matter to the agency, which in 2010 launched a four-year field study on the impact of shale gas hydraulic fracturing.

Even if the EPA confirms fracing does not pose a risk to drinking water, “increased regulatory pressure will be placed both on well completions and treatment or the disposal of wastewater.”

Regulations may focus in particular on gathering more data at the basin level to track water and understand how operations impact the water table.

“Tracking of water use, from the initial sourcing to disposal, is expected to become an increasingly rigorous requirement,” Stark said.

She warns, as well, that any links to environment concerns will have an impact on operators. U.S. underground injection wells number about 200,000 and permits are relatively easy to obtain, for now.

“Use of these wells could become more restrictive,” Stark said.

Many operators have already begun experimentation with water reuse and recycling. One of the first, Range Resources (NYSE: RRC), attempted fracing with reused water, which had no impact on its operations and led to higher volumes of reused water.

Another, Devon Energy (NYSE:DVN), has run a long-term trial program with Fountain Quail distillation systems to create distilled water and concentrated brine from its wastewater. However, the process costs 20–30% more than bringing in water locally in the Barnett shale.

After years of progress, reclamation methods such as water reuse or water treatment are cheaper, but would still increase costs by 10-15%. Reuse would also increase water-hauling costs, which are about 80% of logistics expenses.

An established operator, such as Andarko Petroleum Corp. (NYSE: APC), has dramatically reduced the expense of its wells from a year ago. In October, Anadarko, based in The Woodlands, Texas, said its third-quarter drilling costs in the Marcellus shale averaged $2.4 million per well, down $1.5 million per well from 2011. In Stark’s scenario, costs could climb back up, on the high end, by $375,000.

Others are looking at alternatives to water used during the fracing process. The use of propane-based gel instead of water can reduce the required truck trips by up to 75% by lessening water transport and wastewater treatment.

But such substitutes pose risk. Waterless fracturing replacements such as liquid propane mean pumping an explosive gas underground.

Another trend operators should take note of is competition for water.

In many areas, principal water supplies come from surface water sources, API said.

Water conflicts are nothing new. In 6th Century B.C., Assyrians poisoned the wells of their enemies. In 1917, the Third Battle of Gaza commenced, in part, to secure water supplies in Palestine.

And in 2010, a water dispute in Pakistan led to weeks of fighting and dozens of deaths, according to CNN.

As access to water becomes more of a constraint for operators, particularly in arid areas and regions with seasonal water-flow variations, water reuse and recycling will become more widespread. Domestically, regulators have started to impose seasonal limits on volumes of water withdrawals via permitting restrictions in Pennsylvania.

In July, the Susquehanna River Basin Commission (SRBC) suspended water withdrawals due to lower stream flow levels in the Susquehanna Basin, shale gas operators including Chesapeake Energy (NYSE:CHK) and Talisman Energy (NYSE:TLM).

And in dry regions of Texas, water demands for shale gas production are viewed as competing with water use for irrigation and domestic use, Stark said.

Overall, the trends toward more disclosure, impact assessments and water management will affect operators, she said.

“Not only will changes be required to maintain compliance, but also the requirements will create opportunities for competitive advantage in operations, particularly for larger operators,” Stark said.