The primary objective of the proposal is to lower the cost of drilling and improve the effectiveness of fracture treatments in shale gas reservoirs. This is proposed to be accomplished through, (a) The development and field-testing of nanoparticle based water-base drilling fluids which are less expensive than currently used oil-base drilling fluids, and (b) The addition of nanoparticles to minimize water blocking in slick-water fracs in shale gas reservoirs.