The Neduvasal project: Throwing a spanner into Modi’s ‘Make in India’

By Remya Padmadas

The Centre’s move granting approval for a proposed hydrocarbon extraction plant in Naduvasal, Tamil Nadu has led to massive protests in the town that have lasted nearly two weeks.

What is the protest about?

The Press Information Bureau in its press release on February 15, stated that the Cabinet had approved the awarding of contracts for production of oil and natural gas to several corporations, as part of the 2015 Discovered Small Field (Marginal Field) Policy.

Out of 31 contract areas (23 onshore and 8 offshore) that were to be utilized for hydrocarbon extraction, one of the proposed onshore sites was a 10.0 sq. km area in Neduvasal, a town in the Pudukkottai district of Tamil Nadu.

The news came as a severe blow to the farmers, said K. Dakshinamurthy, former village panchayat president of Neduvasal, to The Hindu. The farmers feared that the project could lead to soil contamination and groundwater depletion, thereby affecting their crops.

Buoyed by the success of the recently concluded Jallikattu protests, the villagers took to the streets. People from nearly 100 villages around Neduvasal have extended their support to the protestors and have come to the village to take part in the protest. Several youngsters, riding in bicycles from surrounding villages, distributed pamphlets on the hazards of the hydrocarbon project. The protest has also seen a huge wave of support from opposition parties in the state, celebrities and the social media.

While the government claims in its press release, that setting up the plant would provide indirect labour to more than 500 people, the villagers claim that about one lakh people from Karambakudi, Thiruvarankulam and Peravurani would lose their livelihood, if the project came into existence.

Is the hydrocarbon project really harmful?

Even though Union Minister Pon Radhakrishnan of the BJP has branded the protests “anti-development” and based on the unfounded fears of the villagers, prominent environmental activists like Nityanand Jayaraman echo the concerns of the villagers.

Nityanand Jayaraman states categorically that hydrocarbon extraction cannot be done without harming the environment and that “the degree of harm to the environment can vary from severe to very severe, but not from insignificant to very severe.” He proposes that unless the government can prove that the drilling can be done with all safeguards in place, ensuring that the negative impact to the environment is nil, the project should not be launched.

Manikandan, who started a Facebook page named “Save Neduvasal” in light of recent events, uses social media to spread awareness about the issue and exhort people to act before it is too late. He says that in the process of drilling more than 6000 ft into the earth’s crust to obtain methane or natural gas, all the water from the water table would be sucked out, mixed with various chemicals and pumped into the land. This would mix with the soil and the water and affect agriculture and water quality.

“Years ago, the ONGC came to the village and dug wells for exploration. The toxic waste from the wells still remains without decomposing. Imagine what would happen if the project took off”, he says.

Speaking of worst-case scenarios, he cites the example of an oil extraction project in Turkmenistan which went horribly wrong, resulting in a methane gas chamber burning continuously for the last 40 years, to this day.

Fittingly, the crater is referred to as the “Door to Hell”.

Dr. Rajesh R Nair, Associate Professor, scientist and geophysicist at IIT Madras maintained that if proper safety measures were in place, there would be very less chance of soil or water contamination, but refrained from commenting on the Neduvasal project as he was not aware of the extraction technology that was being used.

However, with regard to hydrocarbon projects in India, history too speaks volumes.

In October 2013, an oil pipeline laid by the Oil and Natural Gas Corporation (ONGC) in Uran, Mumbai developed a leak, releasing about 5000 litres of crude oil into the Arabian Sea. The oil spread over an area of 10km, causing considerable water pollution, much like the recent Ennore oil spill.

In 2014, a Gas Authority of India Ltd (GAIL) pipeline carrying natural gas in a village in Andhra Pradesh caught fire, killing 15 people and leaving 25 others seriously injured.

Similarly, in 2016, another leak was reported in an ONGC pipeline laid in the Krishna-Godavari basin in the state. A total of eight such instances were reported in a span of three months in the Antarvedi and Sakhinetipalli areas of the Konaseema region in Andhra Pradesh.

Why is this project important to the BJP government?

The project is one of Modi’s flagship energy policies and a part of the ‘Make in India’ initiative, aimed at securing the country’s energy needs.

India has proven oil reserves of 5.7 billion barrels, and gas reserves of 1.4 trillion cubic meters, yet given the low production base, the country remains a net importer of energy. In 2014, imports accounted for more than 80 per cent of the country’s total oil demand and 25 per cent of the total gas demand.

The Discovered Small Fields (DSF) policy in 2016 was launched with the aim of reducing the country’s dependence on oil imports by 10% by 2022.

Interestingly, the project in Neduvasal (10.0 Sqkm) was awarded to GEM laboratories Private Limited, a company based out of Devangere in Karnataka, started by late BJP Member of Parliament, G Mallikarjunappa.

A similar project has also been proposed at Karaikal, Pondicherry and has been awarded to Bharat Petroresources Limited. The Puducherry Chief Minister V Narayanaswamy said the Union Territory would oppose the project, as the Centre had failed to obtain permission from the territorial administration before sanctioning the project.

Both these sites have seen mass protests in the last two weeks, potentially jeopardizing the government’s plan.

There were similar protests in 2013, over the Coal Bed Methane exploration project, which aimed at extracting methane gas using hydraulic fracturing. In November 2016, the central government was forced to cancel the project owing to the agitation by the farming community.

In 2014, GAIL’s Rs 3400 crore gas pipeline project was cut due to opposition by farmers from seven districts in the state. Similarly, in December 2016, the India-based Neutrino Observatory (INO), proposed to be set up in the hills of Theni, was scrapped due to agitation by activists.

The oil and natural gas industry is a major source of Foreign Direct Investment, attracting FDI worth US$ 6.6 billion between FY 2000–15. The Neduvasal and Kariakal projects are expected to generate gross revenue of Rs 300 crore, out of which the state government would get Rs 40 crore as royalty.

Ahead of the CERAWeek 2017, the annual international conference in Houston from March 6-10, 2017, where Minister Dharmendra Pradhan, will address a gathering of senior energy executives and innovators on the future of energy, the government is expected to make all efforts to have its cards ready.

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