05/03/2023 1

ENERGY AVANT GARDE-OIL AND GAS SOLUTIONS REDEFINEDDebarpit ChandraHimanshu TyagiAvinash GautamVicky NagpureMIT Pune

05/03/2023 2

What can be done to make India energy secure?

Immediate Steps

Infrastructure development

Blending of fuel additives

All-out offshore exploration

Exploitation of unconventional HC resources

Manufacturing industries, ancillary fabricating, industries that support

oil and gas.

Pipelines, refineries, transportation modes, better

connectivity etc.

Pipelines and refinery capacity have to be increased manifold as can be seen from the maps. Extensive development has to be done for future handling. The older refineries have to be upgraded too.

Technological advancements, use of integrated and inter-disciplinary

approach

Marine exploratory surveys, more number of offshore exploratory vessels, pre-salt etc reservoir

explorationAdvancements have to be made to make exploration successful. A lot of area is still remaining unexplored. Extensive explorations have to take place at the Mahanadi Basin. Deepwater explorations have to take place across all the basins in the country.

Pursue technological innovations- horizontal well technology, fracking,

etc

CBM, shale gas, gas hydrates, tight gas, heavy oil

India is said to have substantial shale gas resources in the order of 250 tcf, but has made limited efforts to explore this potential. Issuance of a shale gas policy is not expected before late 2012. To allow for the existing reserve potential to materialize, important legal, structural and environmental challenges will have to be overcome. A National Gas Hydrate Program was launched by the government over a decade ago and the initial phase of the program has confirmed the existence of gas hydrates. CB explorations have begun but a lot has to be done.

Ethanol, butanol and other high efficiency additives for gasoline

Biodiesel, Picrate, etc for diesel

Immediate steps

Infrastructure development

Manufacturing industries, ancillary fabricating

Pipelines, refineries, transportation modes

All-out offshore exploration

Technological advancements

Marine exploratory surveys

Exploitation of unconventional HC

resources

Pursue technological innovations- horizontal well technology, fracking,

etc

CBM, shale gas, gas hydrates, tight gas, heavy oil

Clearly defined water utilization policy. Seawater Osmosis, rain water harvesting compulsory for companies

and proper recycling

Blending of fuel additives

Ethanol, butanol, etc for gasoline

Biodiesel, Picrate, etc for diesel

Clearly defined water utilization policy. Seawater Osmosis, rain

water harvesting compulsory for companies and proper recycling

05/03/2023 3

Future Course of Action

EOR/IOR

Liquefied Natural Gas Terminals

Encouraging Indian service companies

Stimulus to renewable energy sector

Research and Innovation

Increasing recovery factor, recovering untapped oil

Integrating different disciplines – biogenetics, microbiology, etc-ASP, Chemical injection,

microbial etc

Extra oil recovered in an EOR pilot study at the Mangala field, Rajasthan. The oil recovery has increased manifold because of Alkaline Surfactant Polymer Flooding. These kind of EORs have to be applied to every field to take out the untapped oil. This couldn’t have been possible if EOR wouldn’t have been applied. Also, supplementing EOR was the fact that waterflooding was conducted from the start. This IOR method helped in better pressure maintenance

Partnerships with foreign service companies & hence Transfer of technology

Solar, wind, hydro, nuclear etc.

Integrating the above technologies with oil and gas. E.g. Solar EOR

These charts compare current installed capacity presently and in 2031-32. It can clearly be seen that the share of renewable energy remains almost constant. For India to be energy secure, Renewable energy has to increase several times

Creating pacts with countries in Asia Pacific Region for importing LNG

Construction of LNG terminals in all the three coastal regions

Establishing dedicated sea and land corridors for smooth shipping

The ports need to have higher handling capacity and dedicated corridors for efficient shipping. Pacts with countries can ensure energy security for a long time. Neighbors like Myanmar etc have high gas reserves. Proper communication should be established with them through proper diplomatic channels.

Academia and industry collaboration for cost effective techniques

Special fund for Research activities and setting up of specialized laboratoriesIndia’s largest company

ONGC’s R&D profile can be seen in this pie chart below. It can be seen that it is not as much as it should be, though ONGC has one of the highest R&D expenditure in India. Every company’s and also the Government’s R&D expenditure should increase. There should be an environment where research is encouraged. Eg- Tax breaks for companies which involve certain percentage of their income in R&D. Shining examples where R&D has helped in huge profits are the MBA fields of Cairn India. Extensive research have helped in better understanding and more recovery.

Encouraging Tax Regime which will help in International Service Companies’ Indian

Subsidiaries

The growth of the Norwegian Oilfield Service Sector as seen in these charts from 2006 to 2010. It can be inferred that for the growth of E&P business, service industry’s growth has to be there and vice-versa. For more E&P activities, there should be enough services that can cater to the operators.

Future course of action

EOR and IOR

Increasing recovery factor, recovering untapped oil

Integrating different disciplines – biogenetics, microbiology, etc

Encouraging Indian service companies

Partnerships with foreign service companies & hence Transfer of technology

Encouraging Tax Regime which will help in International Service Companies’ Indian

Subsidiaries

Stimulus to renewable energy sector

Solar, wind, hydro, nuclear etc.

Integrating the above technologies with oil and gas. E.g. Solar EOR

Liquefied Natural Gas Terminals

Creating pacts with countries in Asia Pacific Region specifically for importing LNG

Construction and upgradation of LNG terminals in all the three coastal regions

Establishing dedicated sea and land corridors for smooth shipping

Research and Innovation

Academia and industry collaboration for cost effective techniques

Special fund for Research activities and setting up of specialized laboratories

05/03/2023 4

Strategic Endeavors

Optimal Use of Resource Potential by Proper Technology. 4D Management and possible redevelopments of every field, EOR application for taking out the last oil

Investments in Overseas Assets taking into account Geopolitical, Economic conditions and Value Addition, Returns Overtime etc

Fiscal Policy- Parity Pricing should be implied immediately as proposed. More tax rebates to companies which help in reducing the subsidy crunch- Companies which reduce India’s import bill

Transportation Policy- More than 50% of Public transport should be made electric in Tier III and Tier II cities. To be followed up by Tier I Cities. Can be taken up under the JNNURM Program

05/03/2023 5

What measures can be adopted by the Govt. of India to boost domestic exploration of Oil and Gas

1. Formation of a 5 member Hydrocarbon Energy Commission

Hydrocarbon Energy

Commission

Head- Retired

NOC director

Armed Forces Legal Representati

ve

Government

Auditor

Representative of MoPNG

Representative of MoEF

Duties:- 1. All companies will submit their business proposals to the commission. The HEC will analyze it and suggest it’s changes and forward it to the DGH, MoPNG. All the concerns of the armed forces, environment, finances etc will be handled by HEC. The report has to be forwarded to the DGH within 90 days. The DGH will also have to take action on the report within 90 days, whatever the action maybe.2. The HEC will report everything to the PMO, Planning

Commission ensuring timely and necessary action is taken. It will work directly under the PMO.

3. It is to have autonomy from MoPNG in taking decisions.4. It will review every industry and government funded

research taking place in India in the oil and gas sector every six months.

•Exploration and taxation policy1. The licensing policy should be changed to OALP (Open

Acreage Licensing Policy) in this calendar year itself.2. Higher exploration cost rebate over ten years.3. 10% tax rebates on dry wells (excluding shale gas and

confirmed by DGH).4. Tax exemption for companies taking part in research

activities with Indian entities and researching in India.5. NOC’s forming ventures with private entities to explore and

exploit Unconventional HC resources. Tax exemptions for them too.

6. Lobbying should be allowed with limited expenditure. This expenditure should come under the purview of CAG.

7. Tax exemptions for companies with ventures with small Indian companies ($10 mn entities and smaller).

8. Tax exemptions for companies taking exploration licenses in poorly and very poorly explored areas.

9. Higher import duty for Oilfield tools but lower import duty for raw materials. Specialized kiosks in ports for handling oilfield tools and personals.

10. Rebate of certain percentage of Import duty with certain conditions like duration, scale of operation

Hydrocarbon Energy Commissio

n

Head- Retired

NOC director

Armed Forces Legal Representati

ve

Government Auditor

Representative of

MoPNG

Representative of MoEF

References1. It’s our turn now-E&P partnership for India’s Security, Energy,

Utilities and Mining, PricewaterhouseCoopers, October 20122. Prospects for Shale Gas Development in Asia, Examining Potentials

and Challenges in China and India, Jane Nakano, David Pumphrey, Robert Price Jr., Molly A. Watson.

3. Exploring India, Petrotech 2012, October 2012, PwC India.4. NIO FORMAT FOR SUBMISSION OF BIDS & PRICE LIST OF

INFORMATION DOCKETS AND DATA PACKAGES ETC. FOR EXPLORATION OF OIL AND NATURAL GAS UNDER NELP, NINTH OFFER OF BLOCKS, MoPNG, GoI, 2010

5. BP Statistical Review of World Energy, June 20126. BP Energy Outlook 2030, January 20127. Emerging opportunities and challenges, Oil and Gas, PwC India, 23

January 20128. Annual Report , Planning Commission, GoI, 1989-909. Hydrocarbon Asia, April-June 201010.India Energy Book 2012, World Energy Council11.Understanding Energy Challenges in India, Policies, Players and

Issues, International Energy Agency12.India 2006, Oil and Gas, Davos, IBEF13.Outlook for Indian oil and gas sector stable in 2012: Fitch, Januar

20,2012, The Economic Times14.Nigeria During and After the Oil Boom: A Policy Comparison with

Indonesia, Oxford Journals.

15.In Brazil, Energy Finds Put Country at a Whole New Power Level, October 2011, The New York Times

16.www.dghindia.org