Should India Go Ahead With Shale Gas Exploration, Or Will It Be Wasted Effort? – OpEd

Shale is a fine grained sedimentary rock that can be a rich resource for petroleum and natural gas, and as such shale gas is the natural gas that is trapped within shale formations.

The Government of India had announced policy guidelines on October 14, 2013, whereby national oil companies ONGC and OIL were to take up shale gas and oil exploration activities in their nominated blocks.

While the ultimate success of shale gas exploration efforts in India remains to be seen from the point of view of technological and economic feasibility, the fact remains that very large quantity of water has to be injected for shale gas exploration. Such water will have to be pumped from running river or ground water sources. Depletion of ground water resources can be a scary situation.

Given the fact that several parts of India are already suffering from severe water scarcity due to frequent drought like situation and “water war” between the states are becoming very frequent, the question is whether India should go ahead with shale gas exploration at all that would require huge quantity of fresh water and result in large quantity of used waste water that would be chemically contaminated.

Should India spend energy, time, efforts and resources in what appears to be a negative project?

Global trend

Though the USA has been the forerunner in shale gas exploration in the world, shale gas will not be uniquely American phenomenon. There is similar geology in several countries around the world.

The UK Parliament recently voted narrowly to allow fracking to extract shale gas under the country’s national parks and certain other protected sites. The new legislation, which permits drilling at least 1,200 meters below the surface in national parks, was approved by 298 votes to 261.

China is taking steps to exploit shale gas resources. China plans to produce 6.5 billion cubic meter of shale gas by 2016, 15 billion cubic meter by 2017 and more than 30 billion cubic meter by 2020.

While the examples of the initiatives of the above countries are there, India has to approach shale gas exploration issues with great caution, considering the ground realities in the country, where water shortage is becoming increasingly evident. A blind following of the approach of the other countries could prove to be counterproductive for India.

Government of India’s policy

Government of India has allowed Oil and Natural Gas Corporation of India (ONGC) and Oil India Limited (OIL) the right to explore shale gas and oil in their nominated blocks. While ONGC will take up 175 blocks, Oil India will do it in 15 blocks in three assessment phases.

According to the policy, ONGC will get 50 blocks in the first phase, another 75 blocks in the second and 50 blocks in the third phase. Oil India would take up five blocks each in all three phases.

Plans of ONGC

ONGC has sought permission for drilling eleven exploratory wells for shale oil/shale gas in Cambay basin at Mehsana, Ahmedabad and Bharuch districts of Gujarat, one well in Cauvery basin at Nagapattinam in Tamil Nadu and five wells in KG Basin at East and West Godavari districts of Andhra Pradesh, with total estimated investment of around Rs.700 crore.

ONGC will have to drill at least one well (two in blocks having area more than 200 sq km) for assessment of shale gas and oil in each of these blocks.

ONGC’s experience so far

ONGC signed a memorandum of understanding with ConocoPhillips, USA, to undertake joint studies of the four basins: Cambay, Krishna Godavari, Cauvery and Damodar.

Based on the studies, a shale gas pilot drilling program was firmed up in the Broach depression area of Cambay Basin in technical collaboration with Conoco.

The drilling of Jambusar-55 (well in the Gujarat block), the first well under the pilot program, has started. As on November 2015, the well has been drilled to a depth of 1,735 metre and further drilling is in progress.

India’s MoU with USA for shale gas cooperation

India and the USA signed memorandum of understanding for shale gas cooperation during the recent visit of President Barack Obama to India.

According to the MoU signed by the two countries, the US will help India in key areas like assessment of shale gas reserves, technical studies to start exploration and training of personnel.
What benefit shale gas can do for India ?

The US’ EIA believes that India’s technically recoverable shale gas reserves are about 95 trillion cubic feet (tcf).

To give an idea, 95 tcf is enough to run India’s gas-fired power stations for at least 20 years at current consumption rates.

Critical factors relating to shale gas exploration

Shale gas exploration requires specialized technology for horizontal drilling and hydro fracturing. In hydraulic fracturing or fracking, a mixture of water, sand and chemicals have to be injected into shale formations to release shale gas/oil.

Shale gas and oil extraction requires enormous quantity of water to be injected at high pressure to break the shale rock formations and release the embedded gas and oil in a process that is called hydraulic fracturing or “fracking”.

The quality of the fresh water that is used for injection is very much different from the waste water that would arise and come out after the fracking.

The fracked oil wells generate about half of a barrel of wastewater for each barrel of oil produced. Fresh water use and wastewater production are two of the chief environmental concerns about hydraulic fracturing.

The amount of water needed depends on the length of the well, the number of fracturing operations per well and the properties of the target rock formation. Drilling a single well may require around 30 million liters of fresh water and a large number of wells have to fracked to produce adequate quantity of shale gas to justify the investment made and get reasonable rate of return.

Due to the huge demand for fresh water, hydraulic fracturing can pose serious risks to local water supplies especially in drought prone regions.

Waste water that is contaminated with chemicals and impurities is often pumped back into the Earth after a frack is complete.

Finding ways to treat and dispose of or recycle the large volume of chemical laden flowback waste water and brine laden with high level of contaminants that is produced over the lifetime of gas well, poses serious challenges. Expertise in treating and recycling used water is critical for doing shale gas exploration. Adequate technology to treat the chemically contaminated waste water generated due to fracking is yet to be adequately developed and demonstrated.

Shale gas production requires horizontal drilling which is expensive. Drilling cost varies with the thickness of rock formation between the shale gas play and the bottom of treatable water. If the rock is too thick, the cost economics of shale gas may become very adverse.

Technology development efforts

Water free extraction techniques that utilise shock waves, acidisation which opens tiny pores in rocks, and injection of carbon dioxide into the shale rock are being developed.

But, such technologies have not been commercially established so far.

Environmental issues and protest in USA

In USA, environmentalists have been critical with regard to fracking carried out for the production of shale gas / oil. The activities have been met with growing amount of public criticism. The primary concern are very real issues surrounding land use, huge requirement of fresh water, waste water contamination and their disposal, emissions and seismic activity.

Energy companies in the USA used nearly 250 billion gallons of water to extract shale gas and oil from hydraulically fractured wells in the US between 2005 and 2014, a new study finds. During the same period, the fracked wells generated about 210 billion gallons of waste water.

It is reported that California, with a long coastline, is experiencing an unprecedented drought that is forcing families to flee those very areas where shale reserves are most found.

Oklahoma, home to the 27.5 Tcf Woodford shale, has seen its seismic activity go through the roof since 2008. The increase is associated with pumping of wastewater into earth. Between 2006 and 2012, Oklahoma re injected more than one billion barrels of wastewater annually.

And it is not just Oklahoma – earthquake incidence is up in fracking territory across the central and eastern United States, according to the United States Geological Survey (USGS).

The environmental issues have come full circle in Denton, Texas in USA after a controversial ban on the drilling activity entered into effect. Denton’s ban prohibits drilling within the city limits about 270 wells and joins other local referendums passed in California, Colorado, Ohio and New York.

Indian water resources

Average annual precipitation – 4000 BCM
Avg. precipitation during monsoon (June to Sept) – 3000 BCM
Natural runoff – 1986.5 BCM
Estimated utilizable surface water resources – 690 BCM
Total utilizable ground water resources – 433 BCM
Total annual utilizable water resources – 1123 BCM

BCM – Billion cubic meter

It has to be seen that average annual potential of `utilisable’ quantity of water in the country is only 1,123 billion cubic meter (BCM), as given above.

India has 18% of the world’s population; but it has 4% of water resources of the world.

Annual per capita availability of water which was 6,042 cubic meter in the year 1947, decreased to 1,816 cubic meter in 2001 and further decreased to 1,545 cubic meter in 2011.

It is estimated that annual per capita availability of water will further reduce to 1,340 cubic meter by 2025 and to 1,140 cubic meter by the year 2050.

Should ONGC go for shale gas exploration?

In the USA, there have been many protests against shale gas exploration including water scarcity and seismic imbalance due to reinjecting large quantity of waste water into the Earth, sub soil disturbance etc. Such issues are bound to arise in India, with much more serious implications, if India were to proceed with shale gas exploration.

Dense population of India, the frequent scarcity of water due to drought conditions and likely increase in demand for water for irrigation and drinking purposes clearly highlight the fact that diversion of scarce water resources for shale gas exploration are bound to invite huge protest in the country.

No doubt, India is endowed with a rich network of rivers, but India suffers from scarcity of fresh water because of high demand for irrigation and an even more rapid increase in industrial and domestic needs. Further, India faces water stress where shale gas reserves are most to be found, which are the Cambay, Gondwana and Krishna-Godavari basins, as well as the Indo-Gangetic plain.

In India, though the government owns what is below the surface, landowners have no incentive to lease out their holdings. Instead land will have to be acquired for fracking, but land acquisition has become an awfully contentious issue in India.

In recent times, we have seen that even the natural gas pipeline project in Tamil Nadu and other states have been objected by the local population due to land acquisition and safety issues. Such objection has resulted in the projects getting inordinately delayed. Similarly, coal bed methane project in Tamil Nadu has also been severely criticized.

It is evident that it is a calculated risk for India to put so much effort in shale gas exploration, since the conditions in the country are not suitable and appropriate for taking up shale gas production in a big way.

There is no point in India going for shale gas exploration, when it is crystal clear that the project can not be implemented against public protest and in violation of ecological interests.

The Government of India should take a firm and pragmatic decision not to proceed with shale gas project in the country.