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India opens up to shale

India’s state-run energy companies have been given the go-ahead from the government to develop shale gas and oil.

India’s Cabinet Committee on Economic Affairs (CCEA) said on 24 September it will allow Oil and Natural gas Corporation (ONGC) and Oil India to explore for shale gas within onshore blocks the government has already allocated to them.

ONGC will explore for shale gas in Gujarat’s Cambay basin and is expected to start drilling first wells in October, according to local media.

ONGC said the company was in discussions with US firm ConocoPhillips to jointly develop shale gas.

The announcement contradicts the government’s statement last year that both private and state-owned energy firms would be allowed to explore for shale gas in India.

India could have 1.95 trillion cubic metres (cm) of technically recoverable shale gas, according to the US Energy Information Administration (EIA).

The EIA has identified four potential basins with shale gas in place: the Cambay Basin, Krishna-Godavari, the Cauvery Basin and Damodar Valley.

The EIA also said there could be 3.7 billion barrels of technically recoverable shale oil lying within five formations across the four basins.

India’s energy demand has soared over the past decade and it is hoping unconventional gas and oil will help it to cut its oil-import bills and become self sufficient in energy by 2030.

India produced 894,000 barrels of oil a day (b/d) in 2012, according to Cedigaz. Last year alone India’s oil demand rose by 5% to 3.7 million b/d. This is up from 2.4 million b/d in 2002.

The country’s gas demand was 54.6 billon cm of gas in 2012, up from 27.6 billion cm ten years earlier. Its gas production fell 13% last year, to 40.2 billion cm.

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