NeduvassalHydrocarbon

ProjectAdditional information to the

Q&A with முனை�வர்மு.ராம்குமார்

05-03-2017The Tamil TV program in Thanti TV can be seen at

http://www.thanthitv.com/schedule/schedule.aspx?pgid=2

DISCLAIMER• This is inspired by a very good interview in the• The various questions asked are expanded in slides• The subject is highly specialized and has numerous

‘conditional’ variations to the situation. Therefore, the answered Q&A in this presentation are – ‘only best generalized technical judgement’.• The context and applicability to Neduvssal is kept in mind –

however, not specifically tailored to be absolutely right • Abbreviations used:

• HC - Hydrocarbon• Petroleum Exploration & Production - E&P

1. What is the position of India’s HC institutions• Directorate General of Hydrocarbons (DGH) is regulator – like

SEBI, RBI etc.• ONGC, OIL, CAIRN, RIL etc. are HC operating companies – like

BSE, NSE, SBI, PNB, HDFC, ICICI etc• Dedicated specialized institutes of learning (Teaching focus) are

formed – 1) UPES – Dehradun (private university), 2) RGIPT Rai Bareilly, 3) PDPU Gandhinagar and 4) IIPE Visakhapatnam.• Other than these, IIT Bombay, IIT Dhanbad (earlier called ISM

Dhanbad) and IIT Madras has courses on Petroleum Exploration and Production (E&P)• India lacks established and functioning ‘independent’ institutes

in E&P. All the above are very basic institutes.

2. Occurrence of HC in India and World• World’s largest HC fields are in Saudi Arabia and Qatar. Middle-

East, Russia, Kazhagastan, USA, Europe-North Sea, Brunei, Indonesia have major deposits

• India’s first HC was made in Digboi, Assam (world’s 2nd discovery in 1866). Post independence Gujarat became a big HC area (Cambay basin). In 1974 Bombay Offshore basin was discovered (Bombay High field). Cauvery, Krishna-Godavari (AP coast), Mahanadi, and Jaisalmer (Rajasthan) are other major HC areas currently producing. All the states of North-East have HC.

• Cauvery is well established HC area since 1980s. Narimanam field is among the first discoveries (1985) and produced since 1989.

• Cauvery is ranked 244th in world ranking and far behind all other areas in India (listed above).

3. Is there Ban on HC production?• IMPORTANT – There are 2 types of HC production.1. Conventional HC production as expected in Neduvasal – NO

major ban anywhere2. Unconventional HC production as being done in Shadol-MP

– YES there are casesThere had been litigations on land access, local issues against Conventional. Most resolved by proper compensation modelsUnconventional HC production is through techniques like ‘fracking’. There are many protests and bans. E.g. Locals in Australia have protested and stopped development CBM (Coal-Bed Methane technology). France and parts of Europe have banned Shale-Gas development.

4. HC E&P experience in Tamil Nadu• Early discovery since 1980s.• Production done since 1989.• No major accidents• Smaller spills and expulsions known.

• Neduvassal locals have been complaing of such at Neduvassal-2 well site.

• ONGC is major operator• Few Offshore and Onshore fields/blocks are operated by HEOC

and other private operators• Largely SAFE experience.

• Compare with major ‘BLOW OUTs’ and fire in Krishna-Godavari basin

5. Ground Water, Its use and disposal• Conventional HC field (Neduvassal) is deeper than 1km from surface• Typical Ground water is much shallow - < ¼ km deep• HC occurs ONLY when there is a TIGHT SEAL from the field and NO COMMUNICATION

with ground water• Water is used in engineering and building well site and project facilities (like any

engineering)• Water is pumped into well(s) to support pressure in HC fields – that water is normally

NEVER allowed from ground water. In the Neduvassal case, it must come from DEEPER acquifer (> ½ or ¾ km). • THIS IS AN AREA OF REGULATION AND CONCERN

• Water disposal have strict state and central rules. The excess produced water – MUST BE TREATED, TESTED for SAFETY and DISPOSED without any clear risk.• This is an area of weak regulation in India. Locals do suffer from industrial effluents in many parts

• LOSS of water to agriculture or soil / river contamination from produced water NEEDS to be monitored.• Operating company can keep this information OPEN and checked regularly.• This is how world over the issue is managed.

6. Onshore –vs- Offshore development• HC E&P is a business. It has to be profitable. Cost of production

+ Taxes + Levies MUST BE LESS than Revenue from sale.• E&P is a very expensive and high-tech business.• Technology for OFFSHORE field development is typically 10-30

times more than ONSHORE field.• India’s offshore ‘economic’ viable fields are very few and NONE

in Cauvery basin area now. (HEOC operates one offshore field, RIL, ONGC discovered but they are uneconomical)• There are few manageable options in ONSHORE Cauvery. • Neduvassal & Karaikkal are these.

7. Land use and Damage• Conventional fields (Neduvassal ~< 10km2) are produced through

25 wells. Add the pipe-lines, support systems, processing plants and sale-point.• Each of these facilities will require land 120x120 m or more –

spread over the 10km2 area.• Access roads, office area, workshops etc will be there• Land damage (in absence of spill) can be quickly recovered 100%• In event of spill, there shall be penalty and compensation to

aggrieved party (should be rare)• LAND damage and use is a REGULATORY issue.• GOOD – FAIR regulator == NO ISSUES of long range pain

8. Effluents from HC fields• Most countries (not India) has strict effluent

measurement and control rules• H2S is very poisonous gas that can come out. DEADLY ==

BHOPAL gas disaster.• Neduvassal gas composition not known to assess risk

• Other gasses CO, CO2, N2 are sometimes left on the atmosphere.• THIS NEEDS MONITORING and REGULATION

• Gas/ Oil pipelines (normally buried below root level in grounds) can• Leak causing accidents (Standard industrial risk)

9. Methane, Biogas, HC• VERY valuable possibility in the interview:

1. If Milk can be organized and procured throughout the state <> Surely, bio-waste can be segregated and made into energy

2. Severe draught – YET, how much ‘rain water harvesting’, ‘cleaning water bodies’, ‘preventing sand mining harming water bodies’ --- is achieved?• India is socially very negligent and irresponsible society

• Methane as coming out of bio-waste is ‘dispersed’ and causes severe damage. Methane from HC fields is ‘concentrated’ and used as CLEAN fuel.

• HC is still the MOST VIABLE and POWERFUL fuel option to this world. INDIA critically needs HC.

• Nuclear + HC are only practical hope to meet India’s energy demand.• If we don’t : Our independence will be bartered to energy supplying

countries in Middle-East/ Russia!• We will remain at the bottom of ‘per-capita energy consumption’ in the world

10. சாதகம் : பாதகம்Risk : Rewards from HC

Rewards = சாதகம்1. India & Tamil Nadu needs

energy.2. There will be economic &

skill development locally3. Revenue to locals + State

+ Centre4. Experience to do more

HC projects without harming anyone.

Risk = பாதகம்1. GEM is unknown and no expertise

in HC2. The license doesn’t say NO to

unconventional3. Spill from Neduvassal-2 as reported

(not compensated) can follow4. Weak monitoring and corrupt

regulation5. Locals left to face consequence after

damage.6. Industry pollute our air and destroy

our water - common man suffers!

Regulation is the Key to Quantify, Assess &

Correct the damage from Risk.

Unfortunately, India is very weak in regulation. This needs significant competency and a large amount of ‘integrity’. Both are easily sacrificed by the system in the country. In rare cases when regulation works, the law is so slow to bring accountability and redress. Union Carbide after Bhopal disaster is still enjoying the weakness of law. 32 years on, the victims are awaiting case closure.