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Interaction | December 2013

Shale gas is not environmentally hazardous

ONGC´s outgoing CMD Sudhir Vasudeva is a man in demand even ministers would like him to stay awhile in his chair. In his freewheeling interview with Shashidhar Nanjundaiah, Vasudeva looks back in satisfaction at the accomplishments of his top-ranked PSU, and gives us a look-ahead in shale and power generation.

On availability of gas, the government has been very gung ho about gas prices and that is to be expected, but how do you foresee the availability of gas domestically? What prospects have you factored in?
Yes. We have identified six important and highly specialised areas besides conventional exploration. About 450 mt of oil is located in deep waters, offshore and high-pressure, high-temperature environments.

What are your plans in CBM?
Coal Bed Methane (CBM) is methane present in coal seams and that needs to be produced, shale is the title portion of the reservoir, this is where the production of oil happens and from that it migrates to sedimentary vessels. So if earlier we have been eating from the dining hall, we are now entering the kitchen. The kitchen is little dirty in the sense that the shales are very tight and need to be fractured.

But the walls of the kitchen are also vulnerable to leaks?
They are vulnerable to pressure, and that´s why we have to create lot of pressure and only thing is to create this pressure we need lots of water.

This whole hydrofracturing (fracking) dilemma [of whether or not to, given the environmental concerns of gas seeping into groundwater] has existed for decades. And we haven´t heard of many accidents in the US where they´re actively undertaking that activity...

Yes. Environmentalists are saying that micro-seismic activity small earthquakes can happen, or that the water table can get polluted. Shale is normally found deeper down. In the case of India, it is 2,000-4,000 m. So the possibility of gas migrating or other way up to water tableùwhich is only a few hundred metres deep is not likely.

So it´s not a threat to the environment?
No, it´s not.

But did the government not commission a US expert group to explore?
The job was to map the potential. The US Environment Information Administration (EIA) had earlier studied and indicated the potential of shale gas in India at about 63 trillion cu ft (tcf) in 10 basins. A second study indicated that only three basins have the potential, pegged at only 1.6 tcf, then again revised the estimate to 93 tcf. We need to see this in the perspective of the fact that only 43 tcf of conventional gas is available in India.

Land and water are the two biggest problems in shale exploration. Fortunately, you need to drill only horizontal wells for shale you can drill many horizontals from one location. New research has made water recyclable.

The chemicals added to water to increase the viscosity of water can be hazardous, so dis¡posal of those chemicals will also be an issue.

From the fact that the policy is already being announced, can we infer that India is going ahead with shale exploration?
Yes, the policy has been announced, but it´s only meant for ONGC and Oil India for ´nomination block´, where we have the permission to explore for conventional hydro¡carbon, within whose purview we can also look for shale.

We are awaiting this policy to be released formally. In this non-commercial activity, we know the presence of shale from our work of commercial hydrocarbon, so in order to further confirm this, we have to take out core samples, take out example based on all the study which we do. Next year we will start drilling hor¡horizontal wells, more wells, hydro pressuring etc, and whatever production is possible. We will evacuate it if infrastructure is available nearby.

[As on 21 November, ONGC started shale gas exploration in Jharkhand.] Does ONGC have the specific expertise?
We have the expertise in digging horizontal wells, as in Mumbai High. We have also done hundreds of hydrofractures onshore and offshore. However, multi-stage hydrofracturing is not something we have done in many numbers, but will seek companies that have that expertise and gear ourselves up for future exploration.

Why hasn´t shale exploration been opened up to the private sector?
There are issues. This is a nomination exploration. It will be opened up through the bidding route later. In NELP, it has worked on a profit-sharing model.

What are your plans in power generation?
We are already in power generation. In Tripura, we were compelled to go into power because gas was not being utilised, we had a lot of potential of gas there in Tripura and since the consumption was not there, so we decided to set up a 726 MW power plant. The first unit of 363 MW is already operational, and the second unit would be ready early next year. We set up an SPV called ONGC Tripura power plant, where ONGC has 60 per cent stake, the rest shared between IL&FS and Government of Tripura. The company is now looking for the expansionùseeking some run-of-the-river power plants in Uttarakhand. Solar is on the anvil too. We are taking gas from a marginal field in the western offshore, planning to bring into Daman, in that we have indicated that if the government allocates this gas to us, then we can set up either a power or fertiliser plant.

Oil and Natural Gas Corporation
ONGC is an Indian multinational oil and gas company headquartered in Dehradun. The company produces around 69 per cent of India's crude oil (equivalent to around 30 per cent of the country's total demand) and around 62 per cent of its natural gas.

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