1. Potential of shale gas in Indian sedimentary basin Dr. A M Dayal Emeritus Scientist Petroleum Geochemistry Group Council of Scientific & Industrial Research National Geophysical Research Institute Uppal Road, Hyderabad 500007 Guar International 17-18 Nov 2015, Jaipur

2. For the rapid economic growth, country need large amount of energy in any form. It is extremely important to estimate the magnitude of energy requirements and the fiscal deficit, subsidies and interest and revenue shortfall in last five years. Guar International 17-18 Nov 2015, Jaipur

3. Government is paying subsidies in various form including oil and gas. But subsidies and interest are more than double than interest we are paying which is alarming. Guar International 17-18 Nov 2015, Jaipur

4. There is concern that conventional oil resources will not be able to meet the growing energy requirements. The increasing gap between supply and demand for energy has forced to explore and develop unconventional resources of energy. Tight gas, coal bed methane, under ground coal gasification and shale gas are unconventional gas resources. In future gas consumption will increase and will be main factor for the economic performance and strategic stability of any country. Unconventional sources of energy are increasingly important Guar International 17-18 Nov 2015, Jaipur

5. Major sources of energy in India Coal 53% Oil31% Natural Gas8% Hydro electric 5% Nuclear 2% Renewables 1% 31% The oil/gas constitute 39 % of our demand of energy while the major source of energy is 53 % of coal. Other sources constitute 8%. 53% 8% 6% Guar International 17-18 Nov 2015, Jaipur

6. In 2008, USA was running short of gas and the price was10$/mcf Production of Shale gas changed the economy of USA and continues to do so. The present price of gas in USA is 3.7 $/mcf. Shale gas present production takes care of 30% of the USA requirement. In last two years the electricity charges has been reduced drastically due to cheaper fuel as shale gas. A successful shale gas rock is mostly composed of quartz and carbonate minerals. The brittle nature of shale allows fracking and enhanced permeability for larger amount of shale gas production. Guar International 17-18 Nov 2015, Jaipur

7. BEIJING, April 18, 2014 (Reuters) - PetroChina, Asia’s largest oil and gas producer plans to spend more than 1.6 billion $ on shale gas this year which is three times of its over the past few years. There is good competition between PetroChina and Sinopec. PetroChina feels that Sinopec Corp is near a breakthrough by announcing a commercial finding. PetroChina has increased its 2015 shale gas output target from 1.5 to 2.6 billion cubic metres (bcm). That would be 2% of China's total natural gas. Since around 2010, PetroChina has spent about 482.39 million$ total on pilot shale drilling. Guar International 17-18 Nov 2015, Jaipur

8. Now the question is what is shale rock: Shale is a sedimentary rock deposited as muds in tidal flats and deep water basins. During the deposition there could be accumulation of organic matter in the form of algae, plant, and animal derived organic debris. Shales contain 95 percent of the organic matter. However, this amounts is less than one percent by mass in an average shale. Guar International 17-18 Nov 2015, Jaipur

9. Carbonaceous shale occurs at different time period from 2.7 to 2.5 Ga, 2.0 to 1.7 Ga and 800-600 Ma. Increase of carbonaceous shale deposition reflect: 1.Increased of oceanic hydrothermal fluxes 2.Anoxia on continental shelves 3.Disrupted ocean currents Guar International 17-18 Nov 2015, Jaipur

10. RegionShale GasTight GasCBM North America Latin America Europe USSR Middle east Africa Asia Pacific countries South Asia Total 3,840 2,116 548 627 2,547 274 3,526 2625 0 16,103 1,371 1,293 431 901 823 784 353 1254 196 7,406 3,107 39 275 3,947 0 39 1,215 470 40 9,051 Distribution of unconventional gas all over the world (TCF) Guar International 17-18 Nov 2015, Jaipur

11. Shale gas potential in various countries. Besides US, Europe is the next continent working on shale gas exploration. Guar International 17-18 Nov 2015, Jaipur

12. Geological parameters for shale gas evaluation are:  Thickness and areal extent  Type and richness of organic matter  Thermal maturity  Mineralogy, faults and fractures  Gas content and gas storage  Adjacent water bearing formations Guar International 17-18 Nov 2015, Jaipur

13. Role of geochemistry in shale gas assessment is: i.Geochemical analysis using TOC, Rock Eval pyrolysis and visual kerogen analysis. ii.Geochemical modelling of hydrocarbon generation and retention. iii. Organic richness. iV. Kerogen type V. Thermal maturity Guar International 17-18 Nov 2015, Jaipur

14. Organic richness is measured by Total Organic Carbon analyser (TOC) and expressed as wt. % of rock. Based on TOC the grouping of source rock for shale gas is as follows: <0.50 wt. %Non source 0.50 to 1.00 wt. %Fair 1.00 to 2.00 wt. %Good >2.00 wt. %Excellent TOC decreases with maturity. Based on kerogen type it could be oil prone, gas prone or oil and gas prone. Guar International 17-18 Nov 2015, Jaipur

15. Shale gas Exploration Technology The shale gas exploration has following steps: 1.Selection of basin and seismic study to know the extent and thickness of shale in the geological formation. Guar International 17-18 Nov 2015, Jaipur

16. 2.Exploration drilling and analysis of cores for geochemistry and petrophysical properties. Guar International 17-18 Nov 2015, Jaipur

17. 3.Understanding the extent of shale gas play with the help of pilot wells, seismic interpretation and log correlation. Guar International 17-18 Nov 2015, Jaipur

18. 4.Quantification of shale gas by studying the adsorption and desorption studies on the cores to measure Langmuir volume and gas content with change of pore pressure. Guar International 17-18 Nov 2015, Jaipur

19. 4.The petrophysical evaluation and reservoir characterization is important to evaluate the shale gas reserve. Porosity and permeability are important measurement for shale gas exploration. Guar International 17-18 Nov 2015, Jaipur

20. 5. Geochemical analysis and the study of stress regime helps in designing the well completion, drilling horizontal wells and selecting proper perforation technique. 6. Rock Eval pyrolysis system is an analytical equipment to measure the S1, S2, HI, OI, TOC, Tmax, type of kerogen etc. Rock Eval 6 for pyrolysis and oxidation Guar International 17-18 Nov 2015, Jaipur

21. 7. The data acquired during the process, from drilling to completion and fracturing can be used to predict the performance of shale gas production for future, using numerical reservoir simulator. Guar International 17-18 Nov 2015, Jaipur

22. 8. The ultimate aim is to increase the productivity index. This method helps to gain vertical connectivity amongst various gas bearing layers and allow easy connectivity. Guar International 17-18 Nov 2015, Jaipur

23. Hydraulic Fracturing: Hydraulic fracturing stimulation is the most extensively accepted tool for the development of shale gas reservoirs. This is due to the fact that shale reservoirs have very tight nature with low permeability and to make them flow at an economical rate stimulation by hydraulic fracturing is necessary. Guar International 17-18 Nov 2015, Jaipur

24. Horizontal drilling and hydraulic fracturing Guar International 17-18 Nov 2015, Jaipur

25. In India there are 28 sedimentary basins which have been divided in four categories based on the potential of hydrocarbon. Category I Basin Area (Sq km) Category IC Basin Cambay 53,000Karewa4,000 Assam Shelf 56,000 Spitti-Zanskar 22,000 Bombay Offshore 116,000 Satpura-Rewa 46,000 Krishna Godavari 52,000 Narmada 70,000 Cauvery 55,000 Deccan Syneclise 273,000 Assam-Arakan 60,000 Bhima-Kaladgi 9,000 Rajasthan 126,000 Cuddapah 39,000 Category II Basins Pranitha-Godavari 15,000 Kutch 48,000 Bastar 5,000 Andaman-Nicobar 40,000 Category III Basins Area (Sq km) Himalayan Foreland17,000 Ganga 186,000 Vindhyan 162,000 Saurashtra 80,000 Kerala Konkan 94,000 Mahanadi 69,000 Bengal 89,00032,000 Guar International 17-18 Nov 2015, Jaipur

26. 1. Assam Arakan basin is prospective basin for shale gas exploration. Good shale formation has been reported from this basin. Based on shale formation ~100 Tcf gas is estimated in this basin. Guar International 17-18 Nov 2015, Jaipur

27. 2. Spiti, Kumaun, Kashmir, Karewa and Zanskar basin The main sub basins in Himalayan region are Kashmir, Zanskar, Spitti and Kumaun. Carbonaceous shales samples were collected from these basins. 60 Tcf gas is estimated in these basins. Guar International 17-18 Nov 2015, Jaipur

28. IERT MPRG EGI Neoproterozoic Sirban Shales* Eocene Subathu Shales* Mesozoic Shales Palaeozoic Shales Palaeozoic /Mesozoic Karakoram Shales* Palaeozoic Zanskar Shales* Karewa Gas Seeps Geological Map of Jammu and Kashmir with Potential Shale Formations for Shale Gas Exploration Jammu Kashmir Ladakh *In Thrust Belt

29. 3. Cambay Basin: The Cambay Rift Basin has total area of about 53,500 sq. km. Shales at Mehsana-Ahmedabad, Tarapur, Broach and Narmada are under study for the TOC, type of kerogen and maturity level. Rough estimate is 250 Tcf of shale gas.

30. 3.1 Shales in Cambay basin: Shales formations associated with the lignite mines in Gujarat have been reported from Tadeshkwar, Surat; Rajpardi, Bharuch; Panandhro, Kutch; Madh, Bhuj and Surkha, Bhavnagar. Some of these shales has been analysed in our lab and geochemical data suggest good source for shale gas. Guar International 17-18 Nov 2015, Jaipur

31. 4. Damodar Basin: In the Damodar basin shales of significant thickness have been reported in the following formations: i.Bansa-Chandia ii.Pali-Tikhi iii.Raniganj iv.Barakar v.Talchir vi.Mahendragh The technically recoverable gas in the basin is 30 Tcf. Guar International 17-18 Nov 2015, Jaipur

32. 5. Krishna Godavari Basin: The Krishna Godavari Basin is a proven petroliferous basin in the east coast of India. The basin contains about 5 km thick sediments. Technically recoverable resources are estimated to be about 130 Tcf. Major formations are: 1.Raghavapuram Shale 1100 m thick carbonaceous shale. The organic matter is Type III. 2. The Palaeocene Palakollu Shale has good potential for shale gas. 3. Vadaparru Shale of Lower Miocene with 4% TOC and Type III kerogen has potential for shale gas. Guar International 17-18 Nov 2015, Jaipur

33. 6. Pranhita-Godavari Basin: Pranhita-Godavari basin has good number of shale formations and could be very good source for shale gas. Recoverable gas will be 60 Tcf.

34. 7. Cauvery Basin: The Cretaceous-Cenozoic Cauvery basin covers an area of 9,100 sq km in south eastern India is another basin for shale gas. Recoverable gas is 75 Tcf. AgeFormationLithologyThickness Holocene to Pleistocene AlluviumSand, clay100m L Miocene Pleistocene Cuddalore sandstone Sandstone, limestone, coal300-600m Early to Middle Miocene Sandstone, shale, limestone, coal 1190m Oligocene Shale, sandstone, limestone1060m Eocene Shale, sandstone, limestone1150m PaleocenePondicherryShale, sandstone, limestone700m Late Cretaceous Ariyalur Trichinopoly Sandstone, shelly limestone Carbonaceous shale, limestone 2700m Early Cretaceous DalmiapuramLimestone, black shale400m JurassicSivgangaSandstone, shale1090m Guar International 17-18 Nov 2015, Jaipur

35. 8. Vindhyan Basin: Organic rich shales from Proterozoic Vindhyan basin have been reported at many formations. Study of these shales is very important to understand the maturity, type of kerogen and total organic content. The Vindhyan basin formations are exposed in three sectors (Chakraborty, 2006): 1. Rajasthan sector 2. Bundelkhand sector 3. Son valley sector. Guar International 17-18 Nov 2015, Jaipur

36. 9. Cuddapah basin: Major shale formations are Nandayal, Tadpatri, Owk and Cumbum shale in the basin. Recoverable shale gas is 75 Tcf. Guar International 17-18 Nov 2015, Jaipur

37. 10. Rajasthan Basin The Rajasthan Basin comes under the Category – I basin and presently producing largest amount of hydrocarbon. Estimated recoverable gas is 100 Tcf. Rajasthan Basin has been divided into three Sub-basins: i. Jaisalmer Sub-basin ii. Bikaner- Nagaur Sub- basin iii. Barmer-Sanchor Sub- basin Guar International 17-18 Nov 2015, Jaipur

38. Some of the important points for shale gas exploration with Indian perspective: 1.Cost of drilling and completing will be higher in India. This is due to almost no infrastructure and government support to private players. 2.Indian government does not offer fiscal incentives. 3.In USA and Canada it is mandatory to disclose the substantial and significant information for each wellbore drilled and this information is available on public database for other exploration companies. 4.Lack of widely shared information in India makes it difficult for the efficient independent operator to exploit resources. Guar International 17-18 Nov 2015, Jaipur

39. Hydraulic Fracturing (Water Requirement): 1. The drilling and hydraulic fracturing of a single horizontal well may require 4 to 6 million gallons of water. 2. After hydraulic fracturing, the pressure barriers such as frac plugs are removed, and flowback water is collected at the wellhead. 15 to 35% water comes as flow back water. This water needs treatment, before disposal and refract. 3. Composition of frac fluid consists of sand and water and additives. The additives include biocides, corrosive material, inhibitors, scavengers, friction reducers and surfactant. 4. Once the well begins to produce gas, this water is referred as produced water and is recovered throughout the life of the well. Guar International 17-18 Nov 2015, Jaipur

40. Feed water Flow back water (ppm) pH8.54.5-6.5 Calcium(Ca)2222,000 Magnesium(Mg)62000 Sodium(Na)5732,000 Iron(Fe)4500 Barium (Ba)0.22200 Strontium(Sr)0.454,000 Manganese(Mn)14 Surphate(SO4)532 Chloride201,20,000 Methanol(CH4)--2,000 TOC--6,000 Water contamination There are two questions about the water. 60% of the fracturing fluid remains with shale formation. 40% water comes back as flowback water. On the basis of the study of 233 drinking-water wells across the shale-gas region of Pennsylvania, (Boyer et al.,) no major influences from gas well drilling or hydro-fracturing on nearby water wells were reported. Compared with the pre-drilling data reported in that study, only one well showed changes in water quality (salt concentration). These changes were noticed within days after a well was hydro-fractured less than ~460 m away. Guar International 17-18 Nov 2015, Jaipur

41. ElementsFrac 1 (ppm)Frac 2 (ppm)Frac 3 (ppm)Frac 4 (ppm) Ba7.752,0003,0004,000 Ca7005,00014,00031,000 Fe2001152135 Mg161.957 Sr51,30070002,000 TDS6,0009,000175,000248,000 TSS49048415330 COD1,8145706002,000 Studies have been carried out to estimate the risk of groundwater contamination with hydraulic fracturing fluid. The study concluded that changes induced by hydraulic fracturing could allow adjective transport of fracturing fluid to groundwater aquifers in <10 years We can observe with available data from US that the contamination after every frac is increasing which needs treatment before disposal. Guar International 17-18 Nov 2015, Jaipur

42. Monitoring and fracking for shale gas exploration includes following: 1.Regulatory compliance by local authority 2.Social acceptance by people staying in the area 3.Identify sensitivities like contamination of shallow water aquifer 4.Design appropriate monitoring strategy by independent agency 5.Baseline monitoring for seismicity to observe effect during hydraulic fracturing 6.Operational monitoring include treatment of flowback water, water treatment 7.Post abundant monitoring like disposal of used water in the nearby channel Pros and Con for shale gas Pros: Shale gas is game changing transition fuel, providing security of supply, local employment, reduced energy cost and reduced greenhouse emissions. Cons: Shale gas is an extreme energy that is associated with toxic and radioactive contamination of water supplies, air pollution, earthquakes and climate change. Guar International 17-18 Nov 2015, Jaipur

43. Complete Schematic of Shale gas system

44. Public concern about shale gas: 1.What area will be affected?2. When will be the drilling start? 3. How long the drilling will continue? 4. Will the fracking will be 24x7? 5.Financial benefit for the local community? 6. Source of water for hydraulic fracturing? Public feels that irrespective of good working practice the shale gas operation will involve industrialization of the country side and it will affect local person. Partially it is true. If there is pollution incident there will be the local people who will have to live with it, but chances are vary rare if monitoring by third party is available to local residence. Fracking specific concern: Minor Earthquake (2.5 to 3.5) Fracture opening up the surface for releasing of shale gas Well casing bursting are only 1% but it does effect local community. Contamination of shallow water aquifers will effect local community but only in rare cases, Surface spill of fracking fluid, oil and chemicals to be monitored by independent agency.

45. Environmental challenges and government support The main difference between the shale gas development and conventional natural gas development is the horizontal drilling and large volume of hydraulic fracturing. Fracking generates micro seismicity of the order of 3 to 3.5 on Richter scale, which in case of mud house in the village may create minor damage. Higher natural gas price, advances in hydraulic fracturing and horizontal multilateral drilling have made shale gas wells more profitable. Guar International 17-18 Nov 2015, Jaipur

46. In fact shale gas releases more green house gases than the conventional as it is mainly composed of methane which is powerful green house gas. But compared to CO2 it stays in the atmosphere one tenth of time. The present announcement from the energy minister is quite acceptable for the industry, which is profit sharing and also you have freedom to explore conventional gas and oil as well as shale gas, Coal bed methane, shale oil or even coal. Guar International 17-18 Nov 2015, Jaipur

47. At present we are importing 20% of our gas and 65% of oil requirement which constitute 6% of GDP. Though present energy minister is taking good steps to reduce the import of coal. With such a large fiscal deficit it is necessary to develop the alternate source of energy for the energy security of our country like solar energy and wind energy. It is necessary to setup research institute for shale gas research with the financial support from the oil companies profit. For the required economic growth of our country it is necessary to be 100 % indigenous energy with no import in any form. Guar International 17-18 Nov 2015, Jaipur

48. Govt. plan to auction 69 blocks for the conventional and non- conventional exploration. With low oil prices many oil companies from western world will be participating for these blocks. It also proposes several financial incentives for NOCs, including Income tax and customs exemption, along with reduced royalty to be paid on shale gas. Present policy allows to use technical capabilities in partnership with foreign companies. The report also stresses the need for India to expand its natural gas pipeline infrastructure. The Government will have to create a favourable atmosphere to address the landowners, and oil and gas companies, in view of land acquisition. Guar International 17-18 Nov 2015, Jaipur

49. Thank you for kind listening Guar International 17-18 Nov 2015, Jaipur