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Socio Economic impact of Oil and Gas Drilling and Production Activity for Sustainable Development

by E.Mohan Reddy
Master of Communications and Journalism (MCJ)
Joint Director (Corporate Communications)
Oil and Natural Gas Corporation Limited
Mumbai
ongcpr@vsnl.com
Till recently oil and gas was produced by two National Oil companies in India – Oil and Natural Gas Corporation Ltd. and Oil India Ltd. These two companies together produce about 35% of India’s Petroleum products requirement. Rest of the requirement is imported from abroad in the form of crude oil and petroleum products.

To bridge this widening gap of supply and demand the Indian Government has opened up the exploration and production industry (also called as upstream industry) to the private sector. In the last 4-5 years a number of private sector companies and multi-nationals have entered India in the exploration field.

In view of this liberalized policy there is an upsurge in the exploration activity all over the country to discover more oil and gas reserves. This exploration activity has created a significant impact on the local environment in the places where this activity is pursued. The socio-economic development in and around the drilling sites has improved. The people of the local area are economically better and are enjoying improved infrastructure facilities which has benefited the local people. However, this activity has an indirect impact on the local environment, and calls for an efficient waste management system which can reduce the burden on the environment and maintain the ecological balance.

The present paper will examine the socio-economic impact of the exploration and production activity in the Krishna Godavari Basin. This area has experienced sizable growth because of aggressive investment by ONGC and also due to the entry of private sector Companies. This activity has generated employment and created infrastructure development in the form of roads, communication and other facilities. More than 110 Wells are drilled in this area, which includes Offshore and Onshore and currently about 2.00 Million Metric Tonnes (MMT) of crude oil is produced from the Krishna Godavari Basin.

However, the exploration activity has replaced the fertile land and coconut trees with large columns of steel and machinery. The local people who were dependant on the land were faced to look for an alternative source of income. Besides, the activity has created an impact on the local environment and the ecological balance. This paper tries to quantify these environmental issues through a primary survey.

The survey attempts to analyse the benefits of this activity vis-a-vis its impact on social life of this area.