Published: May 12, 2013
Words: 32,969 (approximate)
Pages: 101
Language: Commonwealth English
Author: Mohit Sharma
Publisher: Freelance Talents
ISBN: 9781301257324
Depletion of conventional resources, and
increasing demand for clean energy forces India to hunt for alternatives
to conventional energy. Intense importance has been given for finding
out more and more energy resources; specifically unconventional ones
like shale gas & gas hydrates, as gas is less polluting compared to
oil or coal. This redacted report covers potential of such energy
sources. NELP has helped in
increased and fair participation of private sector, but a separate and
independent bidding round is required for the unconventional sources of
natural gas, which will help in optimal utilization of resources, as
these are not considered practically in the oil and gas exploration
blocks. Major oil companies, while drilling for oil and gas, have hit
thick structures of coal and shale, but do not show interest in testing
and drilling because they are not permitted to do so.
A policy
that enables oil and gas companies to drill for unconventional oil and
natural gas and to extract and produce shale gas along with conventional
natural gas. This change may revive old wells too, which have been
declared as commercially nonviable and it may also increase the energy
capacity of the country.
• The gases also serve as an alternative for cleaner fuel compared to conventional oil and coal.
•
Acquiring overseas assets for exploring the shale gas structures is
very important as it will help the Indian oil and gas companies to gain
the technical knowhow and the skills needed to operate the business.
•
The government’s assistance towards public and private sector companies
in importing the shale gas, CBM, Gas Hydrates and Tight Sand Gas
extraction technology to India by providing incentives.
• Proper
development of service capabilities. Customization of techniques and
methods used in different parts of world according to the topography,
blocks present in India.
• However, in case of Shale gas It is
necessary to address the environmental concerns regarding the shale gas
operations. There are studies going on to understand the environmental
and public health impact due to shale gas development in the US. India
should use them to shape appropriate regulation.
• The fiscal policy
could include either a royalty tax or severance tax, apart from
corporate income tax. The earnings should be shared amongst the State
and the Central Government to incentivize the state government’s role in
acquiring land. These earnings through taxes will also help the
Government to improve the required services and infrastructure. However,
the Government should also be aware of highly taxing economic rent as
it may alter the prospects of the interested companies. While
considering tax exemptions or tax holiday, the government should be
aware of the fact that the shale gas production is the highest in the
initial years before the production starts to fall rapidly. Hence, the
tax holidays should be given at the end stage of the shale gas
production, while knowing the life span of the formation beforehand.
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