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Shale gas exploration has the potential to generate investment of up to ₹50,000 crore over the next few years in West Bengal.
And, according to Amit Mitra, State Finance Minister, at least two companies — including Great Eastern Energy Corp (GEECL) — that are producing coal-bed methane (CBM) in the Ranigunj belt of Bardhaman district, West Bengal, have expressed interest in exploring commercial viability of exploration of shale gas.
The new unified licensing regime of the Union government has allowed shale exploration from CBM blocks.
The Raniganj block, sources say, has a shale gas potential of 7.7 trillion cubic feet (tcf).
“GEECL has expressed interest to explore and extract shale gas if there is commercial viability. I hope Essar Oil, too, will actively look into it. Other players are welcome. We feel, this segment has investment potential of ₹50,000 crore,” he told reporters and industry captains during an interactive session titled “Gas Industry in West Bengal” organised by FICCI here on Wednesday.
According to Mitra, oil marketing company ONGC has also found a gas reserve in the Ashoknagar area in North 24 Paraganas district of West Bengal. Tests are on to gauge the commercial viability of the reserve.
The Minister further pointed out that the State government was willing to support such companies, even as he urged downstream and user industries like plastics and ceramics to explore setting up units so that the gas sector becomes viable.
Need for regulatory support
According to Prashant Modi, MD and CEO, GEECL, there was a need for a more conducive regulatory framework. Support of both the Centre and State governments are required for these gas exploration contracts to fructify.
“We have already announced an investment of $2 billion (₹14,000 crore at the current exchange rate) over the next 10 years in shale gas extraction,” he said adding that a relaxed regulatory framework should include increasing the licensing period.
GEECL’s CBM block may hold as much as 6.63 trillion cubic feet (Tcf) of shale resources, of which about 1.7 Tcf can be recovered, he said.
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