{"id":598,"date":"2020-10-15T12:31:36","date_gmt":"2020-10-15T12:31:36","guid":{"rendered":"https:\/\/www.competitionreview.in\/blogs\/?p=598"},"modified":"2020-10-15T12:31:36","modified_gmt":"2020-10-15T12:31:36","slug":"shale-gas-perils-and-prospects","status":"publish","type":"post","link":"https:\/\/www.competitionreview.in\/blogs\/2020\/10\/15\/shale-gas-perils-and-prospects\/","title":{"rendered":"SHALE GAS Perils And Prospects"},"content":{"rendered":"\n

Prof. V.P. Gupta<\/strong>,Director, Rau\u2019s IAS Study Circle, New Delhi \u2013 Jaipur \u2013 Bengaluru<\/strong><\/em><\/p>\n\n\n\n

The\nexploration of shale gas is considered as \u201cthe biggest energy innovation of\nthe decade\u201d<\/strong>. The increase in the shale gas production in the US has\nrevolutionised the energy market. Natural gas has emerged as the largest source\nof electricity generation in the United States wherein it accounts for 33% of\nthe energy produced in the country. Further, by 2030, shale gas is projected to\naccount for around 46% of USA\u2019s total gas production.<\/p>\n\n\n\n

This\nchange in the energy-mix in the US electricity generation has brought about\neconomic, environmental and geo-political changes not only in the US, but also\nacross the world. Other countries such as Canada and Argentina have begun to\nexplore the shale resources.<\/p>\n\n\n\n

This\nprovides a unique opportunity for India to tap into its vast shale gas\nresources<\/strong> which could have multi-faceted benefits. The exploration of shale\ngas in India would reduce its import dependence on fossil fuel<\/strong> and\nensure its energy security. Further, it would also help India in reducing its\nemission intensity in order to fulfil its INDC targets under the Paris Accord.\nIn this context, the Union Cabinet has recently approved the policy to permit\nexploration and exploitation of unconventional hydrocarbons such as shale\noil\/gas, coal-bed methane (CBM) etc.<\/p>\n\n\n\n

However,\nthe exploration of shale gas poses environmental and technological challenges.<\/p>\n\n\n\n

This\narticle analyses the prospects, benefits and challenges associated with the\nShale Gas Exploration in India.<\/p>\n\n\n\n

What\nis Shale Gas? <\/strong><\/p>\n\n\n\n

Sedimentary\nrocks are types of rocks that are formed by the deposition and subsequent\ncementation of mineral or organic particles on the floor of oceans or water\nbodies. The sedimentary rocks cover almost 73% of the earth\u2019s surface. These\nrocks are considered to be important sources of natural resources like fossil\nfuels, coal etc.<\/p>\n\n\n\n

Some\nof the examples of Sedimentary rocks are limestone, coal, lignite, shale,\nsandstone etc.<\/p>\n\n\n\n

Shale\ngas refers to the natural gas which is found trapped within the shale formation\ninside the earth\u2019s surface.<\/em><\/p>\n\n\n\n

Why\nis it difficult to exploit Natural Gas?<\/strong><\/p>\n\n\n\n

Natural\ngas (mainly methane) is generally classified under two heads: (a)\nconventional gas,<\/strong> and (b) unconventional gas<\/strong>. Most of the natural\ngas comes under the category of conventional gas where, after drilling in a\nsedimentary basin that is rich in gas, the gas migrates through porous rocks\ninto reservoirs and flows freely to the surface where it is collected. <\/p>\n\n\n\n

Shale\ngas, on the other hand, is located in rocks of very low permeability and\ndoes not easily flow to the surface<\/strong>. It remains trapped within the\nimpermeable rocks. Therefore, the technique for recovery of shale gas is quite\ndifferent from that of conventional gas.<\/p>\n\n\n\n

Technology\nbehind Shale Gas Exploration<\/strong><\/p>\n\n\n\n

Extraction\nis done through horizontal drilling<\/strong> through the shale reservoir followed\nby hydraulic fracturing or fracking. Fracking involves injection of water, sand\nand chemicals at high pressure which leads to the cracks in the reservoir which\nin turn allows the gas to flow out to surface.<\/p>\n\n\n\n

Further,\none interesting aspect of this technology is the use of Guar Gum. It is mainly\nused in improving the viscosity and flow of water in the fracking process.\nIndia is one of the largest producers of Guar Gum. The gum is extracted from\nguar ki phalli, grown mainly by farmers in arid lands in Rajasthan and Haryana.<\/p>\n\n\n\n

Shale Gas Revolution in USA<\/strong><\/p>\n\n\n\n

With the spectacular rise in its natural gas production the US has\nreduced the country\u2019s reliance on imported liquefied natural gas (LNG).\nFurther, the US has overtaken Russia as the world\u2019s largest natural gas\nproducer. It has contributed to the growth of US economy by ensuring its energy\nsecurity along with creation of jobs and enhanced revenue growth. <\/p>\n\n\n\n

According to the US Energy Information Administration (EIA), the\nshale gas is expected to provide for 46% of total gas production in the US by\n2030. The US is likely to emerge as a key exporter of shale gas in future. This\nsuccess of shale gas in the US has in turn spurred other countries to map their\nshale gas resources and put in appropriate policy framework for its\nexploitation.<\/p>\n\n\n\n

In a 2013 report, the US Energy Information Administration estimated\nthe quantity of technically recoverable shale gas for 41 countries. North\nAmerica leads the worldwide production of shale gas, with the US and Canada\nhaving significant levels. Beyond the US and Canada, shale gas is so far\nproduced on a commercial scale only in Argentina and China.<\/p>\n\n\n\n

Impact of Shale Gas revolution on Global Energy Market<\/strong><\/p>\n\n\n\n

The shale gas revolution in the US had a profound impact not only on\nthe US, but also on the Global Energy Market. A significant increase in shale\ngas production in the US not only allowed the United States to reduce its oil\nimport dependence but also influenced international oil prices. The increase in\nthe shale gas production in the US led to lower demand for the crude oil leading\nto the decrease in their prices between 2014 and 2016.<\/p>\n\n\n\n

The Organisation of Petroleum Exporting Countries (OPEC) sought to\nstem the decline in the crude oil prices by cutting down on their production.\nThus, it has been recently highlighted that there has to be a greater\ncoordination between the US and OPEC in order to counter volatility in the\nprices in Global Energy Market.<\/p>\n\n\n\n

Shale Gas Prospects in India <\/strong><\/p>\n\n\n\n

The Ministry of Petroleum and Natural Gas (MoPNG) has identified six\nbasins as potentially shale gas bearing. These are Cambay, Assam-Arakan,\nGondwana, Krishna-Godavari, Kaveri and the Indo-Gangetic plain. <\/em><\/p>\n\n\n\n

In\na study conducted by the United States Geological Survey (USGS), recoverable\nresources of 6.1 trillion cubic feet (TCF) have been estimated in India. Some\nof other estimates have put the total reserves to be around 100 TCF, which is\nsufficient to meet India\u2019s gas demand at the current level for about 25 years.<\/p>\n\n\n\n

Let\nus examine the benefits that would accrue to India by exploitation of shale\ngas.<\/p>\n\n\n\n

Compatibility\nbetween Energy Security and Development Needs<\/strong><\/p>\n\n\n\n

India\nis the third-largest energy consumer in the world after China and the United\nStates. With a rapidly growing economy, India\u2019s energy production will need to\nincrease in order to meet our development needs. <\/p>\n\n\n\n

Thus,\nthe challenge for India is to ensure harmony between its development needs and\nEnergy Security. The exploration of shale gas would accommodate its energy\nneeds while at the same time ensure continued economic growth in India.<\/p>\n\n\n\n

Reduce\nImport Dependence: <\/strong>Almost 68% of the energy production in India is\naccounted by fossil fuels, which are mainly imported from the West Asian\ncountries. Additionally, India imports about 30% of its natural gas consumption\nas Liquefied Natural Gas (LNG) at a very high price. <\/p>\n\n\n\n

Hence,\nin order to meet its energy requirements at affordable prices, the Indian\nGovernment has sought to pursue gas-based economy by increasing its use of\nnatural gas from 6.5% at present to 15%. At present, India is looking at other\noptions such as TAPI or import of LNG from Gulf countries.<\/p>\n\n\n\n

The\nexploration of shale gas would thus, enable India to reduce its import of\nfossil fuels and pursue a gas-based economy. The reduced import dependence\nwould in turn help in forex savings and improve the current account deficit in\nIndia.<\/p>\n\n\n\n

Cleaner\nEnvironment: <\/strong>As part of its INDC target under the Paris\nAccord, India has committed to reduce its emission intensity of GDP by 33-35%\nbelow 2005 by 2030. This would entail reduction in emission of GHGs in India\nwithout compromising on our GDP growth rate.<\/p>\n\n\n\n

The\nshale gas emits 50% less CO2 than coal\nand thus would help us in achieving a much cleaner and safer environment.<\/p>\n\n\n\n

Policy\nInitiatives:<\/strong> Having realised the importance of exploration\nof shale gas in India, the government has taken certain policy measures to make\noptimum use of this opportunity. Some of these initiatives are:<\/p>\n\n\n\n

MoU\nbetween India and US:<\/strong> A Memorandum of Understanding (MoU) was signed\nbetween the Department of State (DOS), United States of America and the Ministry\nof Petroleum & Natural Gas in 2010 for \u201cExchange of knowledge and expertise\nin the areas concerning shale gas resource characterisation and assessment in\nIndia\u2019\u2019.<\/p>\n\n\n\n

Hydrocarbon\nExploration and Licensing Policy (HELP):<\/strong> The government has\napproved a new Hydrocarbon Exploration and Licensing Policy (HELP) which\nreplaced the earlier New Exploration Licencing Policy (NELP). Under the new\npolicy, companies can explore and produce all kinds of hydrocarbons including\nshale oil\/gas, CBM & gas hydrate, etc. under single licence.<\/p>\n\n\n\n

Earlier,\nthere were separate policies and licences for different hydrocarbons. This\nfragmented policy framework
\nled to inefficiencies in exploiting natural resources. For example, while\nexploring for one type of hydrocarbon, if a different one is found, it needed\nseparate licensing, adding to cost.<\/p>\n\n\n\n

Jambusar\nShale block: <\/strong>ONGC has started exploration of shale gas in\nJambusar, country\u2019s first shale block in Cambay basin in Gujarat. ONGC plans to\nfollow this pilot project in Cambay Basin with similar drilling programmes in\nother basins.<\/p>\n\n\n\n

Challenges in the exploration of Shale Gas <\/strong><\/p>\n\n\n\n

As discussed, shale gas has indeed proved to be a game changer in the\nUS and hence India has placed high hopes on this gas. But, the question that\nneeds to be asked is : will it work for India too? Does India have the\ntechnological expertise to tap this unconventional fuel? What challenges would\nIndia face?<\/p>\n\n\n\n

In this context, The Energy and Resources Institute (TERI) has raised\ncertain concerns related to exploration of shale gas in its report titled \u201cLook\nbefore you leap\u201d. Let us understand the concerns and challenges.<\/p>\n\n\n\n

Water Scarcity in India<\/strong>: The exploration\nof shale gas requires huge amount of water. In the US, 70 to 140 billion\ngallons of water is used by this industry annually. This is approximately equal\nto the annual water consumption of 80 cities with a population of 50,000. The\nquestion which arises is, would India be able to use such a huge quantity of\nwater, particularly when it is facing the worst water crisis in its history?<\/p>\n\n\n\n

This can be further supported by the report of \u2018Indiawaterportal\u2019\nwhich points out that in the next 12-15 years, while the consumption of water\nwill increase by over 50 percent, the supply will increase by only 5 to 10\npercent, leading to a water scarcity situation.<\/p>\n\n\n\n

Environmental Concerns<\/strong>: The pumping of\ndeadly hydrochloric acid and carcinogens into the shale formations to release\nthe gas would pollute the groundwater, which is already under huge\nenvironmental stress.<\/p>\n\n\n\n

Drilling for shale gas has been blamed for environmental problems in\nBritain and taking note of this problem, France and Netherlands have already\nbanned drilling.<\/p>\n\n\n\n

Land Acquisition<\/strong>: The exploration of shale gas\nwould entail the acquisition of huge tracts of land, which is considered to be\na daunting task in India. This would pose not only legal challenges but would\nalso lead to displacement of a large number of people.<\/p>\n\n\n\n

Other potential problems that could arise due to shale gas\nexploration include:<\/p>\n\n\n\n

\u2022  Lack of clarity on the actual shale gas\nresources in India<\/p>\n\n\n\n

\u2022  Storage and transportation of shale gas<\/p>\n\n\n\n

\u2022  Higher cost of production of shale gas<\/p>\n\n\n\n

\u2022  Higher noise level<\/p>\n\n\n\n

\u2022  Worsening air quality<\/p>\n\n\n\n

\u2022  Seismic concerns<\/p>\n\n\n\n

\u2022  Impact on biodiversity and nature<\/p>\n\n\n\n

Way Forward <\/strong><\/p>\n\n\n\n

Thus, the shale gas can provide answers to some of the most pressing\nquestions in India related to Energy security and need for cleaner environment.\nIt would also help the government in its transition towards gas-based economy,\nthus reducing its import dependence on fossil fuel. <\/p>\n\n\n\n

However, as discussed, exploration of shale gas is fraught with\nmulti-dimensional challenges. Can India afford to use so much water for\nshale exploration, particularly when it is confronted with water crisis?<\/strong>\nGiven the
\nutter disregard for the norms, rules and regulations in India, the shale gas\nexploration would accentuate the existing environmental problems including\ngroundwater pollution.<\/p>\n\n\n\n

But at the same time, India should not let go of this opportunity.\nThere is a need to invest in R&D to develop alternate technologies that use\nless water and are more environment-friendly. At the same time, the government\nshould lay down sufficient safeguards in order to ensure environmental\nprotection.<\/p>\n\n\n\n

Finally,<\/strong> the government and all stakeholders should\nensure the implementation of the rules and regulations in letter and spirit.<\/p>\n","protected":false},"excerpt":{"rendered":"

Prof. V.P. Gupta,Director, Rau\u2019s IAS Study Circle, New Delhi \u2013 Jaipur \u2013 Bengaluru The exploration of shale gas is considered as \u201cthe biggest energy innovation of the decade\u201d. The increase in the shale gas production in the US has revolutionised the energy market. Natural gas has emerged as the largest source of electricity generation in […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[3],"tags":[],"_links":{"self":[{"href":"https:\/\/www.competitionreview.in\/blogs\/wp-json\/wp\/v2\/posts\/598"}],"collection":[{"href":"https:\/\/www.competitionreview.in\/blogs\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.competitionreview.in\/blogs\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.competitionreview.in\/blogs\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.competitionreview.in\/blogs\/wp-json\/wp\/v2\/comments?post=598"}],"version-history":[{"count":1,"href":"https:\/\/www.competitionreview.in\/blogs\/wp-json\/wp\/v2\/posts\/598\/revisions"}],"predecessor-version":[{"id":599,"href":"https:\/\/www.competitionreview.in\/blogs\/wp-json\/wp\/v2\/posts\/598\/revisions\/599"}],"wp:attachment":[{"href":"https:\/\/www.competitionreview.in\/blogs\/wp-json\/wp\/v2\/media?parent=598"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.competitionreview.in\/blogs\/wp-json\/wp\/v2\/categories?post=598"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.competitionreview.in\/blogs\/wp-json\/wp\/v2\/tags?post=598"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}