INDIAN ECONOMY

INFRASTRUCTURE - ENERGY
GAS RESOURCES
Natural gas (mainly methane) is generally classified under two heads: (a)
conventional gas, and (b) unconventional gas. Conventional resources and
unconventional resources are two very different, separate sets of resources that can
potentially be extracted. Both refer to some quantity of fossil fuels that could
contribute to a reserve if they could be extracted economically. The difference
between conventional and unconventional is relatively straightforward, and has to do
mostly with the ease the fuels can be extracted with.
CONVENTIONAL GAS
Most of the natural gas that is produced globally comes under the category of
conventional gas. Conventional petroleum resources are oil and gas found in
sandstone that can be extracted using traditional methods, and with few wells for
each basin. After drilling in a sedimentary basin that is rich in gas, the gas
migrates through porous rocks into reservoirs and flows freely to the surface
where it is collected, treated, and then piped to various users. Conventional gas can
occur by itself or in association with oil. The resources that can be extracted from
conventional petroleum reserves include crude oil, condensate and natural gas.
The products that can be refined include liquefied petroleum gas, fuel oils, petrol,
diesel, kerosene, asphalt base and others. Conventional resources tend to be easier
and less expensive to produce simply because they require no specialized
technologies and can utilize common methods. Because of this simplicity and
relative cheapness, conventional oil and gas are generally some of the first targets
of industry activity.
UNCONVENTIONAL GAS
Unconventional petroleum resources are oil and gas found in a variety of rocks that
need to be extracted using additional technology, energy or investment to release
the resource from the source rock. Unconventional resource development usually
requires extensive well fields and more surface infrastructure. Key features of
unconventional petroleum formations are low
permeability and low porosity, meaning that it
is extremely difficult or impossible for oil or
natural gas to flow through the pores and into a
standard well. Unconventional oil or gas
resources are much more difficult to extract.
To be able to produce from these difficult
reservoirs, specialized techniques and tools
are used. For example, the extraction of shale
oil, tight gas, and shale gas must include a
hydraulic fracturing step in order to create
cracks for the oil or gas to flow through.
Coal bed methane (CBM), which is extracted
from coal beds, is an unconventional gas and, in terms of depth, occurs much

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closer to the land surface than other similar gases. Shale gas on the other hand is
located in rocks of very low permeability and does not easily flow. Therefore, the
technique for recovery of shale gas is quite different from that of conventional gas.
Some examples of unconventional resources include, tight sands gas, coal bed
methane (CBM), shale gas and shale oil.
TIGHT GAS:
Natural gas found in low-permeability rock, including sandstone, siltstones, and
carbonates. Tight gas refers to natural gas reservoirs locked in extraordinarily
impermeable, hard rock, making the underground formation extremely tight.

COALBED METHANE (CBM)

Coal bed methane refers to a reserve of natural gas stored in coal seams. Simply
it is natural gas contained in coal. With India having the fourth largest proven
reserves of coal globally, according to the Directorate General of Hydrocarbons,
the country holds significant prospects for exploration and production of CBM, which
is also seen as a clean energy source.
SHALE GAS
These are natural gas locked in fine-grained, organic-rich rocks. The exploration
and production of shale gas in the United States (US) has been a game changer,
making the country self-sufficient in natural gas over the last few years. This has
created considerable excitement globally, particularly in Europe. India is also looking
at exploring shale gas domestically to fill in the supplydemand gap. The Natural gas
forms 9 percent of the total commercial energy mix in India, but demand far
exceeds supply. One of the key determinants of the viability of this technology is the
availability of large quantities of clean water. This raises a red flag on this
complementary input for exploiting shale gas resources in India, given that India is a
water- stressed country, and is fast approaching water scarcity conditions.

Shale gas refers to natural gas that is trapped within shale formations. Shales
are fine-grained sedimentary rocks that can be rich resources of petroleum and
natural gas. Sedimentary rocks are rocks formed by the accumulation of
sediments at the Earth's surface and within bodies of water. Common sedimentary
rocks include sandstone, limestone, and shale. Basically, it is natural gas
primarily methane found in shale formations, some of which were formed 300-
million-to-400-million years ago during the Devonian period of Earths history. The
shales were deposited as fine silt and clay particles at the bottom of relatively
enclosed bodies of water. Some of the methane that formed from the organic matter
buried with the sediments escaped into sandy rock layers adjacent to the shales,
forming conventional accumulations of natural gas which are relatively easy to
extract. But some of it remained locked in the tight, low permeability shale layers,
becoming shale gas. These deposits occur in shale plays a set of discovered,
undiscovered or possible natural gas accumulations that exhibit similar geological
characteristics. Shale plays are located within large-scale basins or accumulations of

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sedimentary rocks, often hundreds of miles across, that also may contain other oil
and gas resources.
HOW IS SHALE GAS PRODUCED?
Shale gas formations are unconventional reservoirs i.e., reservoirs of low
permeability. This contrasts with a conventional gas reservoir produced from sands
and carbonates (such as limestone).
The bottom line is that in a conventional reservoir, the gas is in interconnected
pore spaces, much like a kitchen sponge, that allow easier flow to a well; but in an
unconventional reservoir, like shale, the reservoir must be mechanically
stimulated to create additional permeability and free the gas for collection. For
shale gas, hydraulic fracturing of a reservoir is the preferred stimulation method.
Hydraulic fracturing (or fracking), a mature 60-year-old technology, is usually the
most efficient and economical way to do this. Thats why up to 95 percent of new
wells drilled today are hydraulically fractured. It has helped produced more than 600
trillion cubic feet of natural gas and 7 billion barrels of oil. The hydraulic fracturing
process was used in conventional limestone and sandstone reservoirs for
decades before the onset of the shale revolution.

This typically involves injecting pressurized fluids to stimulate or fracture shale

formations and release the natural gas. Sand pumped in with the fluids (often
water) helps to keep the fractures open. The type, composition and volume of
fluids used depend largely on the geologic structure, formation pressure and the
specific geologic formation and target for a well. If water is used as the pressurized
fluid, as much as 20 percent can return to the surface via the well (known as
flowback). This water can be treated and reused in fact, reuse of flowback fluids
for subsequent hydraulic fracture treatments can significantly reduce the volume of
wastewater generated by hydraulic fracturing. Fine-grained silica sand is mixed

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with chemicals and water before being pumped into rock formations to prevent the
newly created artificial fractures from closing after hydraulic fracturing is completed.
Producible portions of shale gas formations are located many thousands of feet
below the surface, well below groundwater aquifers. Modern hydraulic fracturing
technology involves sophisticated engineering processes designed to create distinct
fracture networks in specific rock strata. Experts continually monitor all aspects of the
process, which must comply with local, state and federal laws and regulations.
Another major technology often employed in producing natural gas from shale is
horizontal drilling. The shallow section of shale wells are drilled vertically (much like
a traditional conventional gas well). Just above the target depth the place where the
shale gas formation exists the well deviates and becomes horizontal. At this
location, horizontal wells can be oriented in a direction that maximizes the number of
natural fractures intersected in the shale. These fractures can provide additional
pathways for the gas that is locked away in the shale, once the hydraulic fracturing
operation takes place.
IMPORTANCE OF SHALE GAS
Natural gas production from shale formations is one of the most rapidly-growing
trends in U.S. domestic energy exploration and production.
There are 34 states in the US, which have vast deposits of rocks rich in shale gas.
Production of the gas has added about 20 per cent to domestic gas availability and
over 20,000 wells have been drilled. From being an importer of LNG, the country is
now self-sufficient and there are plans to export gas from the very terminals that were
built for imports.
Throughout the geological world, Marcellus and Utica Shale plays have been
identified as potentially rich in fossil fuels. Both are geological formations that were
formed by the accumulation of sediment into a sea. Marcellus has been described as
the largest discovered unconventional gas field in the US and one of the largest
worldwide, with estimated net recoverable resources of 318 trillion cubic feet (tcf).
The other interesting contribution to shale gas development in the US is the export of
guar gum from India, which helps in improving the viscosity and flow of water
in the fracking process. The gum is extracted from guar ki phalli, grown mainly by
farmers in arid lands in Rajasthan and Haryana.
With the advance of extraction technology, shale gas production has led to a new
abundance of natural gas supply in the United States over the past decade, and is
expected to continue to do so for the foreseeable future.
In general, increased domestic production of energy resources often results in larger
supplies and lower prices, a reduced need for imports and enhanced energy security.
Aside from these benefits, developing domestic shale gas resources means
additional jobs when wells are drilled, pipelines are constructed, and production
facilities are built and operated. Shale gas production also means increased tax and
royalty receipts for state and federal governments, and royalty and bonus payments
to landowners.

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Combined with the continued displacement/retirement of coal power plants, greater
shale gas use has helped the U.S. achieve approximately 70 percent of the CO2
reductions targeted under the Kyoto Protocol as of 2012.
CHALLENGES OF SHALE GAS DEVELOPMENT
Developing any energy resource whether conventional or non-conventional like
shale carries with it the possibility and risk of environmental, public health, and
safety issues. Some of the challenges related to shale gas production and hydraulic
fracturing include:
INCREASED CONSUMPTION OF FRESH WATER (volume and sources);
As much as 10 million gallons may be pumped into a single well. Its cumulative
effect could impact aquatic habitats or water availability, especially where
water is a limited resource. Significant water use for shale production may affect
the availability of water for other uses. Operators are pursuing a variety of
techniques, including recycling and reusing produced water, to reduce
freshwater demand. Research is under way to find improved methods of treating
fracture flowback water so it can be reused more effectively.
POTENTIAL GROUND AND SURFACE WATER CONTAMINATION;
Some studies document contamination from above-ground chemical spills,
leaks, wastewater mishandling and other incidents.
Induced seismicity (earthquakes) from shale flowback water disposal; Chemical
disclosure of fracture fluid additives;
Induced seismic events are earthquakes attributable to human activity. Although
hydraulic fracturing releases energy deep beneath the surface to break rock,
studies thus far indicate the energy released is generally not large enough to
trigger a seismic event that could be felt on the surface. However, waste fluid
disposal through underground injection can pose some risk for induced
seismicity. Injection for disposal of waste water from the process, however, may
pose some risk, although very few instances have ever been documented.
Scientists have long understood that pumping fluids into or out of the Earth has the
potential for inducing seismic events, including earthquakes that can be felt at the
surface. A series of small seismic events in Arkansas, Ohio, Oklahoma and Texas
over the past several years has drawn public attention to a possible link between
earthquakes and deep wells used to dispose of hydraulic fracturing waste water.
AIR QUALITY IMPACTS;
Natural gas is efficient and clean compared to other fossil fuels, emitting less
nitrogen oxide and sulfur dioxide than coal and oil, no mercury and very few
particulates. However, the drilling process potentially can release chemicals
such as benzene as well as methane.
Air quality risks from shale oil and gas development are generally the result of: (1)
dust and engine exhaust from increased truck traffic; (2) emissions from
diesel-powered pumps used to power equipment; (3) intentional flaring or
venting of gas for operational reasons; and, (4) unintentional emissions of
pollutants from faulty equipment or impoundments.
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 The sources of potential air emissions associated with shale gas production can
occur at the drill site during drilling and fracturing, and at ancillary off-site facilities
such as pipelines and natural gas compressors. The onsite emissions include dust
and diesel fumes, fine particulate matter and methane. Hydraulic fracturing
operations use large amounts of horsepower, provided almost exclusively by
diesel engines. Volatile organic carbon compounds (VOCs) from natural gas
production are a primary concern because they can combine with nitrogen
oxides (NOx) to form smog and contribute to elevated levels of ozone in the
atmosphere. Methane is a strong greenhouse gas and might be released during
the drilling, fracturing, flowback and production phases of shale gas development.
Trucks are often used to transport water and/or fluids used in the hydraulic
fracturing process.
Shale fracture fluid, or slickwater, is largely composed of water (99%); but a
number of chemical additives and sand are mixed in with it to increase the
effectiveness of the fracturing operation. These additives vary as a function of the
well type and the preferences of the operator. Hydraulic fracturing fluids can
contain hazardous chemicals and, if mismanaged, spills could leak harmful
substances into ground or surface water. However, good field practice,
governed by existing regulations, should provide an adequate level of
protection from fracturing fluid risks. Proper management and use of fracturing
fluids is one of the keys to shale gas production environmental protection.
Produced water and fracturing fluids returned during the flowback process
contain a wide range of constituents (some of which occur naturally but others
of which are added through the drilling and hydraulic fracturing process) and pose
a risk to water quality if not properly managed. This water is typically treated to
remove metal ions and other dissolved materials, and then recycled for future use,
or released back into the environment via discharge to rivers, or deep
underground injection. Fracturing fluid that does not return to the surface during
the wells production is confined by thousands of feet of rock layers and stays
underground.
Local impacts, such as the volume of truck traffic, noise, dust and land
disturbance.
The rapid expansion of shale gas development and hydraulic fracturing has
increased attention on potential effects on human health, the environment and
local wildlife habitat. Vegetation and soils are disturbed where gas wells
require new roads, clearing and leveling.
PROPOSED SHALE GAS EXPLORATION POLICY IN INDIA
There is an obvious interest in exploring for shale gas domestically, given the
enormous success in the US. The Ministry of Petroleum and Natural Gas
(MoPNG) has identified six basins as potentially shale gas bearing. These are
Cambay, Assam-Arakan, Gondwana, Krishna-Godavari, Kaveri, and the Indo-
Gangetic plain. The Government of India had also put out in 2012, a draft policy for
the exploration and exploitation of shale gas, inviting suggestions from the general
public, stakeholders, environmentalists, etc.

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The governments draft policy further suggests that there should be a mandatory
rainwater harvesting provision in the exploration area, which trivializes the extent
to which water will be required. It states, as far as possible, river, rain or nonpotable
groundwater only should be utilized for fracking and re-use/recycling of
water should be the preferred method for water management. The environmental
concerns in using water for fracking have been considerably downplayed and their
significance underestimated. Further, enforcing legislation on environmental and
water issues is a problem in India, and such legislation has been more in breach than
in observance.
The treatment of the water before discharge to surface/subsurface water needs to
be in line with the Central/State Ground Water Authority regulations.
While the potential shale gas reserves overshadow those of conventional gas, we
have a long way to go in identifying shale gas rich basins and acquiring the
necessary technology and experience to extract shale gas. Meanwhile, the water
situation will only get worse due to the reducing availability of fresh drinking water
year by year, dropping groundwater levels, and the increasingly polluted rivers and
other water bodies. Unless, there is some revolutionary technological breakthrough,
which does not need the use of fresh water and chemicals, we will be further
endangering the rapidly depleting resource on which all life depends.

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 PREVIOUS YEARS QUESTION (MAINS)
1. It is said that India has substantial reserve of shale oil and gas, which can feed the
needs of the country for quarter century. However, tapping of the resource does
not appear to be high on the agenda. Discuss critically the availability and issues
involved. (200 words) (2013)

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