Mumbai: Reliance Industries Ltd (RIL), which on Thursday announced its third shale gas asset acquisition in the US this year for Rs 1,800 crore, will leverage the technological acumen gained from operating those assets to aggressively bid for shale gas assets in India, when the government invites bids for shale gas exploration & production (E&P) next year. According to sources, RILs huge investments of upto $3.7 billion so far in buying US shale gas assets will pay rich returns in the domestic arena too, with the country expected to possess huge potential in shale gas in Gujarat, the NorthEast and Jharkhand.

India has gas reserves of 39.4 trillion cubic feet compared with 244.7 trillion cubic feet in the US at the end of 2009, a Bloomberg report said this June, quoting the BP Statistical Review. Experts say that the shale rock found in India is similar to those in the US. However, production of gas may be different because the rocks are found deeper in the ground in India than in the US. The extraction of shale gas is a complex technology, distinct from the conventional technology used for the exploration of gas. The shale rock is not as porous as conventional reservoir rocks that are sources of gas, and the gas does not rise up easily. Moreover, the drilling has to be horizontally, unlike in traditional gas exploration. Sanket Singh, an analyst with Frost & Sullivan, says that none of the Indian E&P players posses the technology for exploring shale gas. The technology may be not be expensive since it has been a few years since shale exploration has been going on, and there are many players who have expressed interest in this. However, it would make better business sense for Indian companies to go in for technologies that are proven and available, Singh said.

In April, state-run Oil & Natural Gas Corporation gave a Rs 120 crore contract to Schlumberger to drill for shale gas in the eastern part of India. Drilling wells to assess the reserves are expected to be completed by the end of this year. Analysts say that Indias Essar Oil, which is said to be scouting for conventional as well as unconventional assets overseas, would also figure prominently in the list of bidders for shale assets in India, apart from RIL and ONGC. Moreover, multinationals companies like Exxon Mobil are also likely to participate in…