P. 3 ~ Continued - India starts testing shale-gas plays

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Upcoming shale-gas programs

ONGC in cooperation with Schlumberger (which recently was given an integrated contract for drilling, assessing, and carrying out the relevant operations including hydraulic fracturing) will drill three wells in shale-gas prospects. Two wells will be in the Raniganj subbasin in West Bengal, and two wells will be in the North Karanpura subbasin in Jharkhand, Damodar basin.

The estimated expenditure for this project is about 1.68 billion rupees ($32 million), and completion of the project is expected within 520 days.

Another state-owned exploration and production company, Oil India (OIL), has initiated shale-gas studies in its oil fields in the northeastern state of Assam. A team is collecting and studying data available from the company's fields in consultation with Schlumberger.

The government of India is planning to launch its first auction of shale-gas acreages for exploration by mid-2012. India's upstream regulator, Directorate General of Hydrocarbons (DGH), is drafting an approach paper with international experts on shale-gas exploitation.

Early this year senior officials at DGH said they had identified six basins for resource assessment in the first phase. A task force has been working on a policy framework.

A robust shale-gas policy is likely by the beginning of next year but several issues may delay the policy. Issues include land use, environmental concerns, and simultaneous shale gas and conventional oil and gas exploitation.