A new kid has come to the
neighbourhood, and it is time we took notice of him. He claims good things, but
has potential for a lot of bad. The new kid is shale gas and oil.
These are a part of what is known as
'unconventional' gas and crude resources. They are not different from regular
gas and oil, but are found in different and difficult environments. While shale
oil and gas have been around for decades, recent technological advances have
made their extraction commercially feasible, and there is considerable
excitement around their potential for industry in the next few decades.
Several countries have taken up
exploitation of shale gas in earnest. The leader in this has been USA.
According to the Energy Department of the US Government, shale gas has been a
game changer in that country, with domestic dry shale gas production increasing
dramatically from 1 trillion cubic feet (tcf) in 2006 to 5 tcf in 2010 - about
23 per cent of total U.S. dry gas production.
In India too, there has been some
activity in the last few years, which has culminated with the Ministry of
Petroleum and Natural Gas (MoPNG) of the Government of India making public in
August 2012 its Draft Policy for Exploration and Exploitation of Shale Oil and
Gas. MoPNG also invited comments from all stakeholders on the policy. The draft
policy signals the intention of the Government to go ahead in a serious way in
exploitation of the shale gas and oil resources of the country.
The draft policy mentions that the
Indian Government entered into a MoU with the United States Geological Survey
(USGS) to conduct an assessment of the shale gas resources, and in a study done
by the USGS in 2011-12, "technically recoverable resource of 6.1 TCF has
been estimated in 3 out of 26 sedimentary basins in India." To put this in
perspective, the total estimated reserves of natural gas in India on 31 March
2011 were about 1.240 trillion cubic meters, which is around 43.4 tcf. As more
basins are still to be explored, the MoPNG is hopeful of the shale gas resource
figures going up further.
Serious implications
However, shale gas and oil
exploitation has serious environmental consequences, notably on water
resources. This is reflected in the fact that the main components of the draft
policy include, along with the various issues associated with inviting private
players for exploring and exploiting the shale resources (incentives, fiscal
and contractual issues, bidding and approval processes) measures relating to
water management. This article focuses on highlighting the risks related to
water resources from activities of shale oil and gas exploration and
exploitation.
The draft policy defines shale gas
as "... natural gas generated in-situ and retained in Shale matrix
storage, adsorbed onto organic particles, or within fractures in shales of
source rock origin and obtained there form through boreholes".
Shale formations have low
permeability. The method of recovering the gas trapped in the shale consists of
creating artificial fractures in the rock to allow the gas to escape. As these
fractures are created using large amounts of pressurized water, it is called as
hydraulic fracturing or fracking. The International Energy Agency describes
fracking thus: "large volumes of water (mixed with some sand and
chemicals) are injected underground under high pressure to create cracks in the
rock which remain open. This frees the trapped gas allowing it to flow into the
well bore so it can be produced."
"Another key technology is
horizontal drilling which enables the well to penetrate significantly more rock
in this gas-bearing strata, increasing the chances of gas being able to flow
into the well," the agency adds.
As is clear, the process requires
large quantities of water. This has serious implications for the water
resources of the shale gas areas, including on other existing and proposed
uses. The draft policy states that 11,000-15,000 cubic meters of water will be
required per well (11-15 million litres), but does not indicate if this is
one-time use or if it has to be repeated several times during the life of the
well, nor does it state what it the expected gas output per well, so that
figures for water needed per unit of gas can be estimated. However, the policy
does agree that the volumes of water required are large.
What is of equal concern is that the water, after fracking,
flows back to the surface. As the draft policy indicates, this water can have
high levels of total dissolved solids and other contaminants. These
contaminants can be from the chemicals that are added for the fracking (often
many of these are secret ingredients) or those picked up from residues in the
shale. This may also lead to the contamination of the surface and sub-surface
aquifers.
Need to address environmental issues
Despite the seriousness of the
likely impacts on environment, and particularly on the water resources, the
draft policy does not give it the required consideration. The measures proposed
for managing water are placed in the annexure, and not in the main policy - and
this is itself an indication of the low priority given to them.
Moreover, the measures proposed are
essentially non-measures. It is proposed to make mandatory a baseline study of
water and air quality in shale gas projects, but this is already required in
Environmental Impact Assessments. It is also specified that "river rain
(sic) or non-potable groundwater alone should be used for hydro-fracturing
jobs." It is not clear how using river and rain water for fracking can be
a measure to safeguard local water resources and water uses. Even worse, this
condition is rendered toothless by prefixing it with the words "as far as
possible". Another problem is if groundwater is used for fracking
purposes, this could have serious impact on local aquifers. The measures also
mandate rainwater harvesting in some part of the block, and re-use and recycle
as the preferred (but not compulsory) way of water management.
The draft policy admits "that
there are no specific provisions as on date relating to regulation of the
process of hydraulic fracturing, and water injection process as has been
provided in ... the USA", but then justifies this by saying that "the
Water (Prevention and Control of Pollution) Act 1974, has stringent provisions
to regulate/prohibit disposal of polluting matters into water streams/wells
(section 24-25)." Anyone who has seen the situation of water pollution
control in India, and the effectiveness of these "stringent
provisions" would find this assertion laughable.
In fact, the draft policy should
have actually recommended formulation of provisions to address the requirements
specific to shale gas mining, including to fracking, and even listed some of
these provisions. The consideration given to these issues is in stark contrast
to the detailed attention given to issues of finance, bidding and attracting
private players for exploration and exploitation of shale gas and oil
resources.
One reason why the environmental
impacts could be very serious is that significant parts of shale gas resources
may be in water-scarce areas like Kutch and Rajasthan, or in ecologically
sensitive areas like the Himalayas and the western and eastern ghats. Last, but
not the least, as fracking proejcts have mushroomed in America, there have been
concerns raised that fracking may trigger seismic activity . However, the draft
policy has not even mentioned this issue.
Far from the starting line
Given this background, it is
imperative before proceeding with shale gas exploration and exploitation to
ensure that environmental and social safeguards are properly in place. These
would include amending the EIA notification, 2006 to mandate all shale gas and
oil related activity to require prior environmental clearance; mandatory
disclosure of all the chemicals used in fracking; carrying-capacity studies of
shale areas, particularly the water resources in the region, by independent and
credible agencies; mandatory consent of the gram sabhas in exploration and
exploitation, and a ban on shale gas and oil mining in ecologically sensitive
areas and catchment areas for drinking water sources.
Moreover, since the shale gas and
oil exploration and exploitation are new processes, their initiation must be
preceded by wide-spread debate and discussions. This should include making
public and giving adequate publicity to the regions and areas that are likely
to be shale oil/gas bearing, initiating discussions with the local communities
on the likely impacts in the areas, sharing the experiences from countries
where such explorations are already taking place (e.g. in the US), experiences
not only of the positive and negative impacts but also of the kind of
safeguards that have been put in place.
The policy for shale gas and oil
exploration and exploitation must take into consideration all of these issues
with the seriousness they deserve and not make the same mistake that has been
made with other natural resource exploitation, namely, riding roughshod over
serious social and environmental concerns.
A new kid has come to the
neighbourhood, and it is time we took notice of him. He claims good things, but
has potential for a lot of bad. The new kid is shale gas and oil.
These are a part of what is known as
'unconventional' gas and crude resources. They are not different from regular
gas and oil, but are found in different and difficult environments. While shale
oil and gas have been around for decades, recent technological advances have
made their extraction commercially feasible, and there is considerable
excitement around their potential for industry in the next few decades.
Several countries have taken up
exploitation of shale gas in earnest. The leader in this has been USA.
According to the Energy Department of the US Government, shale gas has been a
game changer in that country, with domestic dry shale gas production increasing
dramatically from 1 trillion cubic feet (tcf) in 2006 to 5 tcf in 2010 - about
23 per cent of total U.S. dry gas production.
In India too, there has been some
activity in the last few years, which has culminated with the Ministry of
Petroleum and Natural Gas (MoPNG) of the Government of India making public in
August 2012 its Draft Policy for Exploration and Exploitation of Shale Oil and
Gas. MoPNG also invited comments from all stakeholders on the policy. The draft
policy signals the intention of the Government to go ahead in a serious way in
exploitation of the shale gas and oil resources of the country.
The draft policy mentions that the
Indian Government entered into a MoU with the United States Geological Survey
(USGS) to conduct an assessment of the shale gas resources, and in a study done
by the USGS in 2011-12, "technically recoverable resource of 6.1 TCF has
been estimated in 3 out of 26 sedimentary basins in India." To put this in
perspective, the total estimated reserves of natural gas in India on 31 March
2011 were about 1.240 trillion cubic meters, which is around 43.4 tcf. As more
basins are still to be explored, the MoPNG is hopeful of the shale gas resource
figures going up further.
Serious implications
However, shale gas and oil
exploitation has serious environmental consequences, notably on water
resources. This is reflected in the fact that the main components of the draft
policy include, along with the various issues associated with inviting private
players for exploring and exploiting the shale resources (incentives, fiscal
and contractual issues, bidding and approval processes) measures relating to
water management. This article focuses on highlighting the risks related to
water resources from activities of shale oil and gas exploration and
exploitation.
The draft policy defines shale gas
as "... natural gas generated in-situ and retained in Shale matrix
storage, adsorbed onto organic particles, or within fractures in shales of
source rock origin and obtained there form through boreholes".
Shale formations have low
permeability. The method of recovering the gas trapped in the shale consists of
creating artificial fractures in the rock to allow the gas to escape. As these
fractures are created using large amounts of pressurized water, it is called as
hydraulic fracturing or fracking. The International Energy Agency describes
fracking thus: "large volumes of water (mixed with some sand and
chemicals) are injected underground under high pressure to create cracks in the
rock which remain open. This frees the trapped gas allowing it to flow into the
well bore so it can be produced."
"Another key technology is
horizontal drilling which enables the well to penetrate significantly more rock
in this gas-bearing strata, increasing the chances of gas being able to flow
into the well," the agency adds.
As is clear, the process requires
large quantities of water. This has serious implications for the water
resources of the shale gas areas, including on other existing and proposed
uses. The draft policy states that 11,000-15,000 cubic meters of water will be
required per well (11-15 million litres), but does not indicate if this is
one-time use or if it has to be repeated several times during the life of the
well, nor does it state what it the expected gas output per well, so that
figures for water needed per unit of gas can be estimated. However, the policy
does agree that the volumes of water required are large.
What is of equal concern is that the water, after fracking,
flows back to the surface. As the draft policy indicates, this water can have
high levels of total dissolved solids and other contaminants. These
contaminants can be from the chemicals that are added for the fracking (often
many of these are secret ingredients) or those picked up from residues in the
shale. This may also lead to the contamination of the surface and sub-surface
aquifers.
Need to address environmental issues
Despite the seriousness of the
likely impacts on environment, and particularly on the water resources, the
draft policy does not give it the required consideration. The measures proposed
for managing water are placed in the annexure, and not in the main policy - and
this is itself an indication of the low priority given to them.
Moreover, the measures proposed are
essentially non-measures. It is proposed to make mandatory a baseline study of
water and air quality in shale gas projects, but this is already required in
Environmental Impact Assessments. It is also specified that "river rain
(sic) or non-potable groundwater alone should be used for hydro-fracturing
jobs." It is not clear how using river and rain water for fracking can be
a measure to safeguard local water resources and water uses. Even worse, this
condition is rendered toothless by prefixing it with the words "as far as
possible". Another problem is if groundwater is used for fracking
purposes, this could have serious impact on local aquifers. The measures also
mandate rainwater harvesting in some part of the block, and re-use and recycle
as the preferred (but not compulsory) way of water management.
The draft policy admits "that
there are no specific provisions as on date relating to regulation of the
process of hydraulic fracturing, and water injection process as has been
provided in ... the USA", but then justifies this by saying that "the
Water (Prevention and Control of Pollution) Act 1974, has stringent provisions
to regulate/prohibit disposal of polluting matters into water streams/wells
(section 24-25)." Anyone who has seen the situation of water pollution
control in India, and the effectiveness of these "stringent
provisions" would find this assertion laughable.
In fact, the draft policy should
have actually recommended formulation of provisions to address the requirements
specific to shale gas mining, including to fracking, and even listed some of
these provisions. The consideration given to these issues is in stark contrast
to the detailed attention given to issues of finance, bidding and attracting
private players for exploration and exploitation of shale gas and oil
resources.
One reason why the environmental
impacts could be very serious is that significant parts of shale gas resources
may be in water-scarce areas like Kutch and Rajasthan, or in ecologically
sensitive areas like the Himalayas and the western and eastern ghats. Last, but
not the least, as fracking proejcts have mushroomed in America, there have been
concerns raised that fracking may trigger seismic activity . However, the draft
policy has not even mentioned this issue.
Far from the starting line
Given this background, it is
imperative before proceeding with shale gas exploration and exploitation to
ensure that environmental and social safeguards are properly in place. These
would include amending the EIA notification, 2006 to mandate all shale gas and
oil related activity to require prior environmental clearance; mandatory
disclosure of all the chemicals used in fracking; carrying-capacity studies of
shale areas, particularly the water resources in the region, by independent and
credible agencies; mandatory consent of the gram sabhas in exploration and
exploitation, and a ban on shale gas and oil mining in ecologically sensitive
areas and catchment areas for drinking water sources.
Moreover, since the shale gas and
oil exploration and exploitation are new processes, their initiation must be
preceded by wide-spread debate and discussions. This should include making
public and giving adequate publicity to the regions and areas that are likely
to be shale oil/gas bearing, initiating discussions with the local communities
on the likely impacts in the areas, sharing the experiences from countries
where such explorations are already taking place (e.g. in the US), experiences
not only of the positive and negative impacts but also of the kind of
safeguards that have been put in place.
The policy for shale gas and oil
exploration and exploitation must take into consideration all of these issues
with the seriousness they deserve and not make the same mistake that has been
made with other natural resource exploitation, namely, riding roughshod over
serious social and environmental concerns.