NEGATIVE EXTERNALITIES

ON NEDUVAASAL
HYDROCARBON PROJECT

Submitted by

R.GOWTHAM

Reg. No. BA0150017

Under the Guidance of

Mr. BALACHANDAR
Assistant Professor

TAMIL NADU NATIONAL LAW SCHOOL

(A State University established by Act No. 9 of 2012)
Tiruchirappalli
Tamil Nadu 620 009
SEPTEMBER 2016
Prof.S.BALACHANDRAN
Assistant Professor in Economics
Tamil Nadu National Law School
Tiruchirappalli
Tamil Nadu 620 009

CERTIFICATE
This is to certify that the project work entitled NEGATIVE EXTERNALITIES
ON NEDUVAASAL HYDROCARBON PROJECT is a bonafide record of the research
work done by R.GOWTHAM, under my supervision and guidance. It has not been submitted
by any other University for the award of any degree, diploma, associate ship, fellowship or
for any other similar recognition.

Place: Tiruchirappalli

Signature of the Guide

R.GOWTHAM
Reg. No. BA015017
II B.A., LLB. (Hons.)
Tamil Nadu National Law School
Tiruchirappalli
Tamil Nadu 620 009

DECLARATION

I, R.GOWTHAM, do hereby declare that the project entitled NEGATIVE

EXTERNALITIES ON NEDUVAASAL HYDROCARBON PROJECT submitted to
Tamil Nadu National Law School in partial fulfilment of requirement for award of degree in
Under Graduate in Law to Tamil Nadu National Law School, Tiruchirappalli, is my original
research work. It and has not been formed basis for award of any degree or diploma or
fellowship or any other title to any other candidate of any university.

Signature of the Candidate

 ACKNOWLEDGEMENT

At the outset, I take this opportunity to thank my Professor Mr.

BALACHANDARAN, from the bottom of my heart who have been of immense help during
moments of anxiety and torpidity while the project was taking its crucial shape.

Secondly, I convey my deepest regards to the Vice Chancellor KAMALA

SANKARAN and the administrative staff of TNNLS who held the project in high esteem by
providing reliable information in the form of library infrastructure and database connections
in times of need.

Thirdly, the contribution made by my parents and friends by foregoing their precious
time is unforgettable and highly solicited. Their valuable advice and timely supervision
paved the way for the successful completion of this project.

Finally, I thank the Almighty who gave me the courage and stamina to confront all
hurdles during the making of this project. Words arent sufficient to acknowledge the
tremendous contributions of various people involved in this project, as I know Words are
Poor Comforters. I once again wholeheartedly and earnestly thank all the people who were
involved directly or indirectly during this project making which helped me to come out with
flying colours.

R.GOWTHAM
NEGATIVE EXTERNALITIES
ON NEDUVAASAL
HYDROCARBON PROJECT
 SYNOPSIS

S.NO: TOPICS PAGE NO:

1 INTRODUCTION 7

2 NEGATIVE EXTERNALITIES 7

3 HYDROCARBON PROJECT 7

4 NEDUVASAL HYDROCARBON PROJECT: THE 8

BACKGROUND

5 SMALL FIELD POLICY 8

6 WHAT IS KNOWN ABOUT THE PROJECT? 9

7 HOW ARE CONVENTIONAL HYDROCARBONS 10

EXTRACTED?

8 HOW IS DRILLING AND EXTRACTION DONE? 10

9.1 NEGATIVE EXTERNALITIES OF 12

HYDROCARBON PROJECT

9.2 WATER RESOURCE IMPACTS: 12

Surface Water Depletion
Surface Water Pollution
Groundwater Depletion
Groundwater Pollution

9.3 HABITAT FRAGMENTATION 15

9.4 LOCAL AIR QUALITY IMPACTS 16

9.5 LOCAL BOOMTOWN DISAMENITIES 16

9.6 AGGREGATE MEASURES OF EXTERNAL 17

DAMAGES

10 HYDROCARBON EXTRACTION IN REST OF 17

WORLD

11 CONCLUSION 19

12 BIBLIOGRAPHY 20
INTRODUCTION:

In the later part of twentieth century, where every multinational companies and native
companies were fighting to earn more profit than others, the rise of hydrocarbon extraction
plays a major role in boosting their aim of attaining their goals.

The paper is broken into sections on the background, deep clearance of idea about extraction
and the negative externalities of hydrocarbon development, and the costs of hydrocarbon
development. While our main focus is on hydrocarbon, fracking has also unlocked vast stores
of oil from low-permeability formations; where possible, the paper mentions the implications
of this additional application for fracking in regard to the life of farmers in a small village
called Neduvasal.

NEGATIVE EXTERNALITIES- AN INTRODUCTION:

A negative externality is a cost that is suffered by a third party as a result of an

economic transaction. In a transaction, the producer and consumer are the first and second
parties, and third parties include any individual, organisations, property owner, or resource
that is indirectly affected. Externalities are also referred to as spillover effects, and a negative
externality is also referred to as an external cost.

Neduvasal is located in an area rich in groundwater and blessed with the fertile soil of the
delta. Unlike the lower reaches of the delta, where agriculture is in distress, Neduvasal still
has a healthy multi-crop farm economy.

HYDROCARBON PROJECT:

On February 15, 2017, Indias central government announced the award of contract
for development and extraction of hydrocarbons from 44 contract areas nationwide, including
28 on-land fields and 16 offshore. Within a day of the announcement, protests broke out in
Neduvasal, a little known village in Pudukottai district in southern Tamil Nadu.

The Neduvasal oil field had been awarded to Karnataka-based Gem Laboratories. Less than
two weeks following the announcement, the agitation has gathered steam, feeding off the
young energy from the recently concluded protests against the ban on jallikattu. Proponents
of the project have questioned the credentials and intelligence of the protestors.
The people of the villages in and around Neduvasal are not aware of the projects specifics.
However, interactions with protestors suggest that what they know in general about oil
exploration and production, and about the track record of ongoing oil production operations
in Nagapattinam, Tiruvarur and Thanjavur districts, is robust enough to form an opinion on
the desirability of the project1.

The regions farmers fear that hydrocarbon extraction will disturb the comfortable agrarian
economy extant in this region. Neduvasal is located in an area rich in groundwater and
blessed with the fertile soil of the delta. Unlike the lower reaches of the delta, where
agriculture is in distress, Neduvasal still has a healthy multi-crop farm economy.

The issues raised by the protestors are worth engaging with. Rather than allowing every
protest to degrade into name-calling, where protestors are branded ignorant, anti-national,
misled or foreign-funded, it may be worthwhile to engage with substantive issues raised by
them

NEDUVASAL HYDROCARBON PROJECT: THE BACKGROUND

The Cabinet Committee on Economic Affairs chaired by Prime Minister on February

15, 2015, gave its approval for all the hydrocarbon projects including Neduvasal
Hydrocarbon Project as a part of the Centres 2015 Discovered Small Fields policy. The
two contract areas, Karaikal located in Puducherry and Neduvasal located in Tamil Nadu
were awarded under Discovered Small Field (DSF) bidding round. They have an in-place
volume of 4, 30,000 metric tons of oil and oil equivalent gas.

The proposed Hydrocarbon Project at Neduvasal village in Pudukkottai district was

recommended for award to GEM laboratories Private Limited, a company based out
of Davangere in Karnataka for extracting both oil and natural gas from hydrocarbon
sediments in an area of about 10.0 sq. km.

SMALL FIELD POLICY:

The Cabinet Committee on Economic Affairs chaired by the Prime Minister Shri
Narendra Modi (CCEA) has approved the award of 31 contract areas as part of the

1http://www.thehindu.com/news/national/tamil-nadu/one-hydrocarbon-project-many-fault-lines/article17410748.ece
Discovered Small Field (DSF) Bid Round 2016.The contract was for 44 oilfields (in 31
contract areas), including 28 on-land and 16 offshore fields discovered by Oil and Natural
Gas Corp. (ONGC) and Oil India Ltd (OIL)

These fields were offered under the new policy for small fields known as Discovered Small
Field (DSF) policy, 2015, which offers improved fiscal terms with the aim to enhance Oil and
gas production and reducing import dependency of the country. These fields were offered
through a transparent international competitive bidding process. And the bidding was open to
all, including National Oil Companies (i.e. ONGC and OIL) and other central and state PSUs.
The Hydrocarbon Exploration and Licensing Policy (HELP) replaced the previous licensing
format (NELP) which was already in place for 18 years. The New Exploration Licensing
policy (NELP) had issued separate licenses to different types of hydrocarbons, whereas
HELP covered all hydrocarbons such as oil, gas, coal bed methane, etc.

Currently, there are three Operational Exploration Blocks (Approximately 1461 sq km),
under Production Sharing Contract System in Tamil Nadu where hydrocarbon exploration is
going on. Under the Nomination regime, 31 Mining leases (approximately 3500 sq km) have
been granted in the State from where 600 tonnes of Oil and 30 lakhs cubic meter of Natural
Gas are produced per day. Till date, more than 700 wells have been drilled for extraction of
Oil and Gas in the Tamil Nadu.

WHAT IS KNOWN ABOUT THE PROJECT?

The Neduvasal oil field reportedly has a seven-year mining lease that expires on
December 31, 2019. The leased area is 10 sq. km from within which oil and gas can be
extracted by the contractor. The recent award is part of the Indian governments October
2015 Marginal Field Policy, aimed at inviting private sector participation in exploitation of
marginal and small oil fields2.

The project is not a coal-bed methane- or shale-gas-extraction project. So the use of hydraulic
fracturing or fracking is unlikely although it can only be ruled out pending further
assessments. The proposal appears to be for a conventional oil and oil-associated gas

2
http://www.ndtv.com/tamil-nadu-news/tamil-nadus-new-protest-over-project-from-pms-big-oil-plan-10-points-
1664623
extraction project with total extractable reserves of 430,000 tons of oil and oil-equivalent of
gas. Speaking to The News Minute, Gem Laboratories has revealed that it has not made up its
mind on the technology to be deployed to extract the hydrocarbons.

Onshore exploratory and production wells in the Cauvery delta are drilled to depths of
between 1,750 m and 6,000 m. And the Neduvasal field, too, if developed will be drilled on
to these depths.

HOW ARE CONVENTIONAL HYDROCARBONS EXTRACTED?

Before production wells are dug, developers sink a large number of appraisal wells to
physically assess the extent and characteristics of the reservoir. If the Neduvasal project takes
off, these wells will be located within the 10-sq.-km lease area.

The entire lease area will not be acquired; only areas around the proposed drill locations will
be leased or acquired. Roughly five acres will be required for each drill site. Neither the
locations nor the number of such wells are known at this point. Some wells may subsequently
be abandoned or converted to other uses3.

Production wells are usually dug to the base of a reservoir while appraisal wells may not go
that deep. In the early days of production, when pressure differentials are high, oil/gas will
gravitate to the low-pressure area at the bore and emerge to the surface on their own. Only
10-15% of the extractable reserves can be harvested at this primary stage. Secondary
recovery involves injecting high-pressure fluids to flush out the oil or gas trapped inside or in
the interstices of the source rocks (sandstone, shale, etc.). New injection wells may need to be
drilled for this purpose, or existing appraisal wells may be used. In ONGCs Cauvery assets,
produced water a toxic by-product separated from the extracted hydrocarbons is used
for flushing. Tertiary or enhanced recovery could involve fracturing the source rock using
high-pressure fluids along with harder substances, like sand or aluminum beads that will
wedge themselves between fissures, to facilitate hydrocarbon flow.

3
https://www.youtube.com/watch?v=ym7oHGgqQ2c&t=275s
HOW IS DRILLING AND EXTRACTION DONE?

Drilling for exploration, appraisal or production have similar consequences. A drill

site may require approximately five acres. The site preparation will involve flattening the
land, laying access roads, laying concrete platforms to accommodate the drilling rigs and
other infrastructure. Land-use change, alteration of drainage patterns, noise and air pollution
are key concerns in this stage.

Once installed and the drilling has begun, the rig will operate on electricity from diesel
generators 247 until the desired depth has been achieved. During this time, air pollution
from generator sets and vehicular movement, and noise pollution, are key concerns. A
drilling fluid, usually water-based mud (WBM), is used to protect the structural integrity of
the drilled hole, cool and lubricate the drill-bit and to evacuate the excavated drill cuttings
(mud, sand and rock chips) to the surface. WBM is the least toxic of drilling fluids.
Nevertheless, along with drill cuttings, it may be contaminated with trace levels of arsenic,
cadmium, chromium and mercury depending on the geology of the area. This is a waste
stream that requires careful disposal.4

Drilling is followed by encasing the well with steel and concrete. The steel casing prevents
the well from collapsing and the concrete and steel also insulate the various water aquifers
from the oil, gas and hydrocarbon-tainted brine that will emerge from underground once the
well begins operating. However, in the time between drilling and encasing, there is a risk of
contamination of exposed aquifers to chemicals or material that are part of drilling fluids.

The extraction is done by a method called fracking process where it employs the injection of
high pressure fracturing fluid into the sedimentary rocks which crack the rocks. The fluids is
made up of water, sand and approximately 635 type of chemicals which includes murtatic
acid, isoprotocyil, sodium carbonate, 2 bromo 2 nitro 1 prospane diol, citric acid, sodium
persulfate, potassium carbonate etc. where many are radioactive.5It approximately uses 5.66
crore litres of water for extracting the hydrocarbon for 5 days in one well, which is a massive
amount of water. The well is drilled from the sand bed which becomes a horizontal well
when it reaches the rocky bed surface. Now a pressure difference is created between the earth
surface and the rock bed surface where the fracturing occurs. The sand and chemicals

4 https://www.youtube.com/watch?v=40dYBdy7DQA&t=223s

5 https://www.youtube.com/watch?v=vNtAKAMbKuk
facilitates the gas to be extracted from the shale which is later extracted along the pressurized
well which will be further treated. In essence, the main requirements of this process are huge
quantities of water, tons of sand and enough space to build a refinery or waste water
treatment plant in the nearby premises, so that they can save money in terms of transport,
logistics.

No doubt that they choose places like Thanjavur, Pudukkotai for water reason thanks to the
Cauvery River flowing through these places. But, I would to emphasize on another reason
why these projects are chosen in places like Tanjavur, Pudukkotai. The main reason is
because of SAND. As I mentioned earlier, sand is part of the fracking fluid which needs to be
pumped to crack the rocks underneath. According to sources (US Demand for RC Proppants
Promotes New Business), each fracking process requires almost 2500 tons of sand (22 lakh
kilograms). This sand is not the ordinary sand we come across. This sand is called as fracking
sand. The term "fracking sand" refers to sand and similar small materials that are used during
the process of hydraulic fracturing, Fracking sand is also termed as a proppant -- a material
used to prop open the underground cracks from which natural gas is harvested during
hydraulic fracturing. This sand cant be an irregular particles with random crystal behaviour.
In other words, an amorphous sand is not desirable for the fracking process. These sand
crystals have to be coated with resin. This coating process wont be efficient if the sand is.
The sand cant have other elements but just silica, much fitting to the requirements. Silica is
known for its round grains, uniform grain size and strength. Apart from the above, this sand
has to be crush resistant, low acid solubility and low turbidity.

NEGATIVE EXTERNALITIES OF HYDROCARBON PROJECT:

Negative externalities have been at the center of most discussions on hydrocarbon

development and these concerns have resulted in suspensions on fracking at the city and town
level, at the state level and even at the country level. The most often-cited concern is in
regards to the impact on water. Other areas of concern have focused on the impacts on
wildlife, local air quality, community disruptions, property values, and health. In a village
like Neduvasal which has so far never experienced anything of this sort the apprehensions are
pretty high. Each of these are discussed below. Impacts that cannot be monetized, including
some of those discussed below, should still be carefully described.
WATER RESOURCE IMPACTS:

The village of neduvasal located in a semi-arid region in the southern district of Tamil Nadu
is solely dependent on. The negative water resource implications of hydrocarbon project have
been heavily covered in the popular media. Hydraulic fracturing uses significant water inputs,
requires wellbores that traverse drinking-water aquifers, and generates large wastewater
streams. Risks to groundwater have gained much the attention in the popular press, however,
a survey of industry, academic, NGO, and government experts found that surface water risks
may be greater. Research quantifying the externalities from water withdrawals and
wastewater disposal is only beginning to catch up with public interest and concern. The
relative ignorance of the people and the lack of coverage by the media has been attributed to
these problems. Below we discuss evidence of negative externalities to both surface and
groundwater resources, divided into subsections based on quantity or quality concerns.

Surface Water Depletion

Water used in hydraulic fracking could reduce the flow of rivers and streams, diminishing
ecosystem services and water available for other diverted uses. The empirical evidence for
negative externalities directly related to freshwater extraction is thin. Along many
dimensions, the quantities of surface water used for hydrocarbon extraction are small.
However, the risks associated with surface water consumption can be expected to vary both
over time and space. Little water is required when gas is actually being produced, thus
withdrawals in any play, no matter how significant, will be transient. Most of the water
consumption in hydrocarbon production occurs within one to five days during the hydraulic
fracturing process and if this water was all diverted during a low-flow period (summers,
droughts) there may be more significant ecosystem impacts. Furthermore, within a river
basin, small streams (and the organisms therein) may be more sensitive to changes
streamflow than larger rivers. In addition, the regulation of water withdrawals and water
rights structures will mitigate the impacts of withdrawals to varying degrees. Additional
research on these spatially and inter-temporally variable impacts is warranted. If the physical
impacts of water withdrawals for fracking were quantified, they could also be monetized.
Estimating the value of instream water for recreational use or ecosystem maintenance often
requires nonmarket methods such as recreational demand models, contingent valuation (CV),
and hedonic housing models. A substantial literature using these methods now quantifies the
marginal value of surface water left instream for recreation, riparian and wetlands restoration,
and other purposes in many different parts of the world. Thus far, there are no estimates in
the literature of the economic value of reducing risks of hydrocarbon extraction related to
surface water scarcity.

Surface Water Pollution

In contrast to surface water withdrawal impacts, emerging evidence suggests that surface
water quality impacts from hydrocarbon development may be significant. Important impacts
thus far have to do with the release of partially-treated wastewater to rivers and streams. After
a well is fracked, varying amounts of the fracking fluids injected into the well returns to the
surface (as flow back) alongside water that was present in the shale formation (produced
water). This wastewater stream contains naturally occurring salts, heavy metals and
radioactive material. It can be recycled to frack additional wells, trucked to industrial
wastewater treatment facilities, or transported to deep injection wells. These effects may
affect the quality of even treated drinking water, as well as important recreational fish
species, causing economic damages, but they are specific to areas that send waste to CWTs.
Most shale plays send liquid waste to deep injection wells, dramatically reducing these risks.
Some risks to surface water are present regardless of location. First, land clearing and the
construction of well pads, pipelines, and roads may increase storm water runoff, erosion and
sedimentation of local rivers and streams. The risk of accidental releases contaminating
surface water has been a focus of public concern. .However, individual spills can and do
occur. Like the other negative externalities described in this paper, any monetization of
hydrocarbon impacts on water pollution would require the development of an appropriate
counterfactual, keeping in mind that water quality impacts from coal mining and other
alternative energy development may be equally as, or more, severe . To monetize surface
water pollution impacts (or the value of their mitigation), benefits transfer could be used,
since the literature contains many estimates of the economic value of water quality
improvements. Given the impacts discussed above, studies focusing on salinity may be
relevant (in watersheds with high background salinity levels), as well as those focusing on
suspended solids. In addition, two recent CV studies address the value of reducing general
surface water risks from hydrocarbon development.

Groundwater Depletion

While the amount of groundwater used for fracking in the humid regions is negligible,
groundwater aquifers have been a significant source of water for fracking in arid and semiarid
regions. However, even in semi-arid states, groundwater withdrawals for fracking represent a
small fraction of total statewide withdrawals .The extent to which the resulting groundwater
depletion represents a negative externality depends on geologic as well as economic factors.
Some aquifers are essentially non-renewable resources, thus the efficient price of
groundwater supplies would include Hoteling rents, accounting for the fact that using up
nonrenewable water today leaves less for tomorrow. If accurate estimates of groundwater
depletion for hydraulic fracturing could be developed, a reasonable approach to valuing the
potential value of marginal damages from this depletion would be to consider the opportunity
cost. For example, the marginal value of water inputs to lost agricultural production, among
uncompensated agriculture users of a common aquifer, would be relevant in some regions. In
others, the relevant marginal damages might be to urban users.

Groundwater Pollution

The academic literature has focused on the potential for groundwater contamination from
either leaking well casings, or seepage from surface storage pits. Regions with plentiful
methane and brine in the sub-surface often have high groundwater levels of these
constituents, thus determining the causal effect of energy development on groundwater
quality can be difficult. Furthermore, public records of complaints of groundwater
contamination are incomplete given nondisclosure clauses in settlements the literature
contains several estimates of the benefits of groundwater protection (or damages from
contamination) in contexts outside of hydrocarbon development that could be used in a cost-
benefit analysis. Some of these studies focus on the cost of averting expenditures (e.g., the
purchase of bottled water) by affected households, which is possible as at least a short-term
solution. Two recent studies focus on the economic value of groundwater contamination from
fracking, itself. Second, in a revealed preference study, Muehlenbachs et al. (2014) estimate
the willingness to pay to avoid the risks to groundwater contamination using transaction
records of properties in proximity to hydrocarbon wells with and without access to piped
water. Groundwater-dependent homes within 1.5km of hydrocarbon wells lose about 3.4% of
their market value after a well is drilled, whereas properties with access to piped water from
public water sources, conversely, experience small net gains (6.6%), likely because royalty
payments made to homeowners for the mineral rights offset other costs of proximity (such as
impaired views or traffic congestion). The difference between the change in price for the
properties with and without access to piped water provides an estimate of the potential
groundwater contamination (i.e., the estimates above imply groundwater concerns reduce
property values by 10%). Therefore, regardless of whether the risk to groundwater is real or
only perceived, the market has reacted and there have already been large impacts on local
property values.

HABITAT FRAGMENTATION

Compared to impacts on water resources, the impact of hydrocarbon development on

wildlife has garnered less attention in the popular press and academic literature. Forest
fragmentation from the construction of roads, pipelines, and well pads in has been
documented) and there is an extensive literature on the effects of habitat fragmentation on
biodiversity implying that hydrocarbon development would also have impacts on
biodiversity. Loss of migratory routes, increased predation, and increased illegal hunting are
suggested as the primary pathways that hydrocarbon might impact wildlife. On a positive
note, with the advent of horizontal drilling, multiple wellbores can be drilled from the same
well pad, resulting in less forest fragmentation than would be the case with spatially diffuse
vertical wellbores. However, nonetheless, multi-well pads cover larger areas than vertical
wellbores, and the surrounding land is typically not reclaimed, even after fracking equipment
has been removed. Allowing the option to postpone reclamation becomes important in
regards to the future liability of land reclamation. Bonds to ensure reclamation are arguably
too low and legacy issues arise when firms can continuously postpone cleanup. An important
research agenda is therefore the optimal siting of hydrocarbon infrastructure as well as the
interaction between development and species preservation, including the use of habitat offset
programs and agglomeration bonuses.

LOCAL AIR QUALITY IMPACTS

Local emissions from hydrocarbon activities might arise from diesel and road dust from
transporting equipment and water; diesel combustion from drilling and hydraulic fracturing at
the well; fugitive emissions from the well; or combustion at compressor stations. Pollutants
can include volatile organic compounds, VOCs, nitrogen oxides, NOx, particulate matter, and
PM (with VOCs and NOx as ozone precursors)

LOCAL BOOMTOWN DISAMENITIES

Temporary boomtowns have been the subject of research in a long history of sociology
papers and to date, shale-induced boomtowns are mainly being researched in sociology,
largely focused on local residents perceptions. With a boomtown comes an influx of new
migrants, putting pressure on pre-existing infrastructure. Increased traffic congestion is one
example, but heavier traffic on existing roads may cause other problems, as well. For
example, increases in heavy truck traffic, transporting water to and from well pads, poses a
risk to other motor vehicles on the road; traffic accident rates are higher in counties with
more hydrocarbon development. Newspaper articles describing increased crime rates,
sexually transmitted diseases, and substance abuse in shale-boomtowns abound. Preliminary
statistical evidence suggests increased crime in shale-rich counties in recent years.

AGGREGATE MEASURES OF EXTERNAL DAMAGES

Health literature, unrelated to hydrocarbon, has demonstrated that the air and water
pollutants discussed in earlier parts of this section adversely affect human health. However
there is little research demonstrating an impact from hydrocarbon development on human
health. Notable exceptions lie in the literature on birth outcomes.

HYDROCARBON EXTRACTION IN REST OF WORLD:

Its feared that the process called Hydraulic Fracking is involved in extraction of
Shale gas. Hydraulic fracturing of shales goes back at least to 1965. In 1976, the United
States government started the Eastern Gas Shales Project, which included numerous public-
private hydraulic fracturing demonstration projects6.

As of 2013, massive hydraulic fracturing is being applied on a commercial scale to shales in

the United States, Canada, and China. Several additional countries are planning to use
hydraulic fracturing. There are hundreds of wells drilled and being drilled by fracking method
in USA. Fracking was banned in 2 states out of 50 states in America.

China is big time into Shale extraction and has increased its target 5 folds last year. China is
the world leader in Shale gas extraction and no protests were recorded. No adverse effects on
human health, environment were recorded in China.

In the United States, fracking or hydraulic fracturing, has become lauded as the promising
gateway fuel that will end our national dependence on foreign oil. Rather than having fossil
fuels imported from other places, we have decided that it would be a much better idea to

6
http://creofire.com/tamil-nadu-hydrocarbon-project/
inject billions of gallons of water and chemicals into the bedrock under towns and cities
where people live to create fissures so that we can extract ancient natural gas pockets.

While natural gas extraction has helped us to meet domestic energy demands, it has also
caused some pretty extreme environmental concerns. Fracking fluid, which can be
contaminated with heavy metals like arsenic, and known human carcinogens, has leaked into
local waterways and polluted drinking water as well as groundwater. People who live near
fracking wells have a heightened risk of developing cancer, asthma, and other serious
ailments associated with inhaling or ingesting toxic chemicals involved in the fracking
process.

In Ohio, 77 minor earthquakes were reported in ONE month that have been linked to fracking
activity, and a shocking amount of fracking related incidents occur every day across the U.S.
To cover up the many terrifying impacts that fracking has wrought on U.S.
communities, fracking companies have resorted to imposing gag orders on children, refusing
to reveal the trade secret chemicals they use in processes, and have even shipped in fresh
water to keep community members quiet. And yet, the U.S. still has not stepped up to ban
fracking.

By knowing its adverse effects certain countries stops the fracking process in their countries
completely or regionally. Certain countries are:

1) France

Fracking was banned in France in 2011 and the ban was upheld in 2012. When asked to
comment on the ban, President Sarkozy explained that France will maintain a ban on fracking
until there is proof that shale gas exploration wont harm the environment or massacre the
landscape. Our kind of thinking, Sarkozy!

2) Bulgaria

After France banned fracking, Bulgaria followed suit in 2012, becoming the second European
country to ban this dirty practice. In an extra sassy move, with this ban, Bulgaria revoked a
shale gas permit granted to the U.S. fossil fuel giant, Chevron. Sorry, were not fracking
sorry.

3) Germany
Germany first enacted a ban on fracking in 2012, and it was upheld in 2014. According to
German Environment Minister Barbara Hendricks, If, at an unforeseeable time, it can be
scientifically proven that [fracking] is completely harmless, then it may no longer be
permanently forbidden.

But, were guessing that that time wont fractually happen.

4) Scotland

Scotland said good day to fracking as of January, 2015. The ban was enacted to allow the
Scottish government to conduct necessary public health and environmental assessments of
the practice. Based on what we already know about how fracking harms people, animals and
the environment, we can only hope that Scottish studies lead to a permanent ban on the
process.

In addition to these four countries who have all-out banned fracking, the UK, Romania,
Denmark, Ireland, South African and the Czech Republic have all instated moratoriums on
fracking. Citing little knowledge of the impacts of fracking on people and the planet, these
countries are putting an end to fracking until they can make a more informed decision. In
addition to these countries, states and municipalities from all across the world have enacted
bans on fracking. In the U.S., it is officially banned in New York State, Vermont, and other
small cities.

Until we can be 100 percent sure that fracking does not pollute the planet or make people
sick, there is no reason we should allow it to happen.

CONCLUSION:

The widespread adoption of hydraulic fracturing, or fracking, has had profound

impacts at the national, state and local levels. The impressive increase in economically viable
reserves has led to lower natural gas prices, and broader penetration of natural gas into
electricity generation and industrial use. At the most basic level, increases in equilibrium
quantities and decreases in price expand consumer and producer surplus, as well as the value
of reserves. Increased use of gas in electricity generation has facilitated a reduction in the use
of coal, with attendant air quality benefits (likely for GHGs, and almost certainly for local air
pollutants). To some extent, abundant hydrocarbon (and tight oil) may also reduce national
security externalities from fossil fuel imports. Short-run increases in employment and
regional economic activity have provided welcome relief from the Great Recession in
producing regions. All these elements represent societal gains, and while we cannot estimate
the sum of these gains, it has undoubtedly been very large.

Negative externalities have also been identified. Empirically demonstrated water resource
impacts include pollution from the release of partially treated hydrocarbon wastewater to
rivers and streams, which has affected downstream drinking water and ambient water quality;
erosion and sedimentation in rivers and streams from hydrocarbon infrastructure; and
migration of methane to local drinking water wells, likely from faulty gas well casing and
cementing.

However, when comparing to the negative externalities which leads to the massive
destruction in the field of agriculture and balance in the ecosystem, these positive
externalities are nothing.

BIBLIOGRAPHY:

WEB SOURCES:

http://www.thehindu.com/news/national/tamil-nadu/one-hydrocarbon-project-many-fault-
lines/article17410748.ece

http://www.ndtv.com/tamil-nadu-news/tamil-nadus-new-protest-over-project-from-pms-big-oil-plan-10-
points-1664623

https://thewire.in/112983/neduvasal-protest-oil-gas/

http://creofire.com/tamil-nadu-hydrocarbon-project/

VIDEO REFERENCE:

https://www.youtube.com/watch?v=ym7oHGgqQ2c&t=275s

https://www.youtube.com/watch?v=40dYBdy7DQA&t=223s

https://www.youtube.com/watch?v=vNtAKAMbKuk