System Integration for Strategic Growth of Petroleum E&P Industry, - A Paradigm shift to minimize Social, Economic and Environmental

Imbalances. -Dr. J.P.N. GIRI, ONGC, India The 17th World Petroleum Congress, Rio de Janeiro, Brazil, 1-5, September 2002 Congress Theme : The Petroleum Industry : Excellence & Responsibility in serving society The presentation text in power point slides will be submitted as per the instruction received. From: Dr. J. P. N. GIRI. ONGC. INDIA E-MAIL: girijpn@rediff.com , girijpn@yahoo.com

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System Integration for Strategic Growth of Petroleum E&P Industry. A paradigm shift to minimize Social, Economic and Environmental Imbalances. Excellence & Responsibility in Managing the Petroleum Business with Economic, Environmental and Social Dimensions. Balancing Environmental and Social Responsibility with Economic Realities. Dr. J.P.N. GIRI, Suptdg., Chemist Suptd, Chemist, (TRG), Regional Training Institute, ONGC, SRBC, R.O. Chennai. Oil and Natural Gas Corporation Ltd., India. Dr. J.P.N. Giri, Suptdg. Chemist. ONGC, SRBC, 9th Floor (West), RTI, CMDA Building,

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System Integration for Strategic Growth of Petroleum E&P Industry, - A Paradigm shift to minimize Social, Economic and Environmental Imbalances.

-Dr. J.P.N. GIRI, ONGC, India.

CONTENTS 1. Abstract. 2. Introduction-An Approach To Sustainable Development Paradigm. Historical Perspective. Recent Advances : A New World Energy Order. 3. The Global E & P Industry : Future Prospects. 4. Advances In E & P Business Prospects : Challenges and Opportunities. 5. Integrated Management System For Minimizing Environmental Impact Of Oil and Gas Production. 6. E & P Industry and Global Climate. 7. A Movement Towards Emissions' Trading.-An Approach To Zero Emission-Oil Field Operations . 8. Recasting An Economy For The Earth,- A Monumental Undertaking On Eco-economy. 9. Applications Of Decision Tree Analysis and Portfolio Management Tools For Petroleum E&P Industry. 10. Adoption Of Environmental Performance As Corporate Social Responsibility. 11. Translation Of Cutting Edge Technologies Into Environmental Benefits. 12. Conclusion- A Paradigm Shift To Minimize Social, Economic and Environmental Imbalances.

System Integration for Strategic Growth of Petroleum E&P Industry, - A Paradigm shift to minimize Social, Economic and Environmental Imbalances. -Dr. J.P.N. GIRI, ONGC, India.
ABSTRACT
The changing diversified business environment, based on an inevitable necessity to establish an equitable global partnership to protect the integrity of natural and social environment in the economic developmental systems, recognizing the integral and interdependent nature of the Mother Earth, offers Petroleum sector in general, and Exploration and Production Industry in particular, many opportunities and challenges, in terms of widening gap in demand and supply of oil and energy, enhanced concern to degrading environmental issues, and growing imbalances in economic and social priorities, to achieve a sustainable developmental paradigm shift. The Petroleum Industry, world-over, is shifting its emphasis to redefine growth strategies through emerging technological excellence, incorporating Portfolio, Resource and Knowledge Management, harmonizing technology, people and process with economic, social and environmental system - integration, from costreduction to more diverse asset-management practices, improving productivity with environmental and social responsibilities. The paper emphatically describes a new paradigm of System Integration to provide a fast, effective and cost-efficient way of analyzing and improving overall asset value with sustainable growth of petroleum industry, minimizing economic and social imbalances in serving society and reduced environmental impact of oil & gas production. In the present complex scenario of business environment, advanced technology is now available to analyze and govern all technical, economic, social and environmental decisions in the petroleum industry as well. As a new methodology, decision-tree analysis, well applicable in oil and gas industry, is helping decision makers to prioritize problems, understand the impact of factors that influences the decision, evaluate uncertainty, quantify the value of new information and build confidence to design a frame-work for more difficult and multidisciplinary problems, by validating it for promoting a sound decision, balancing environmental and social responsibility with economic analysis. In addition, the petroleum Industry is now able to extract- advantage of asset management techniques, that view, projects, society, environment and economics as interdependent portfolio. Studies show that the petroleum industry is using Decision TreeAnalysis and Portfolio-Management tools for field development programs and economic analysis as well as portfolio optimization and opportunity management to combine technical, economic, social and environmental information to meet targeted levels of production, revenues and reserves, with environmental protection and social-responsibility. A knowledge sharing

corporate culture in todays E&P environment has improved the productivity and financial performance substantially by maximizing asset value and strengthening competitive position in a dynamic market place. The Paradigm shift through system integration in Hydrocarbon Industry with knowledge partnership is aimed, to preserve the integral nature of our green planet and to optimize social responsibility of petroleum industry to the serving society for minimizing social and economic imbalances by focusing on the exploratory and producing assets to maximize the output to meet the global energy demand.

A new paradigm of knowledge and system integration to redefine growth strategies of Petroleum E&P Industry. INTRODUCTION : AN APPROACH TO SUSTAINABLE DEVELOPMENT PARADIGM . HISTORICAL PERSPECTIVE
The United Nations Conference on Environment and Development ( THE EARTH SUMMIT ) at RIO De JANERIO, June , 3 - 14 , 1992, reaffirmed the declaration of the United Nations Conference on Human Environment , adopted earlier at Stockholm on June, 16, 1972 and sought to build upon it, with the goal of establishing a new equitable global partnership through the creation of new levels of cooperation among states , key sectors of societies and people ,working towards international agreements , which respect the interests of all and protect the integrity of global environment and development system, recognizing the integral and interdependent nature of MOTHER EARTH ,our home, and proclaimed that HUMAN BEINGS ARE AT THE CENTRE OF CONCERNS FOR SUSTAINABLE DEVELOPMENT . THEY ARE ENTITLED TO A HEALTHY AND PRODUCTIVE SOCIAL & ECO-ECONOMIC LIFE IN HARMONY WITH NATURE. The Earth Summit further focused on its socio -economic & environmental targets for achieving social & eco-economic development by eradicating poverty to decrease disparities of majority of people of the world, and to reduce & eliminate unsustainable patterns of production and consumption of energy and natural resources, while protecting natural environment through the expansion of quality and environment standards developed and promoted by industrialized & advanced nations by means of exchange of scientific and technical knowledge ,and by enhancing the development ,adaptation, diffusion and transfer of technologies, including new and innovative technologies , world over. In view of changed world scenario after EARTH SUMMIT with recent day technological advances, liberalization and globalization through expansion of trade and commerce beyond the periphery of technically, economically and politically strong nations, the free trade economies have profound impact, globally, on sovereignty of developing nations to accept, implement, promote and cultivate a market driven consumerist social & economic culture on a new socio - economic world order. With the dawn of 20th century in 1919, the American Institute Of Petroleum (API) was founded as a result of awareness by the petroleum industry that a lack of standardization had been a primary contributor to the shortage experienced by the industry around the turn of previous century .Again at the advent of new millenium , world over, the recessed E &P business environment , after crude oil price drop of 1998, is under transformation and restructuring around their asset bases with accountability for profit & loss at all levels of industrial activity on one hand, and environment protection with sustainable social & economic progression on the concept of STEP -i.e., Strategies For Today 's Environmental Partnership, aimed at, for petroleum, industry to improve its environmental , health and safety performance, incorporating a basic integrated system for preventing pollution, conserving natural resources , measuring progress , promoting product stewardship, maintaining crisis readiness , addressing community concerns, working with governmental, non -governmental & social agencies , and reporting results to develop responsible rules and standards to protect the environment , the society and the growth of economy on the other.

RECENT ADVANCES : A NEW WORLD ENERGY ORDER

During present turmoil , world over, the political and trade equation is changing in an unpredictable direction and an anti-globalization movement is taking its shape in protest of WTO regime, with oil prices slumping down instead of jumping up, creating a new economic world order, that would automatically result into a new world energy order, striving to maximize productivity of oil and gas reserves, streamlining downstream petroleum industries, and minimizing operating cost. Further global trade interdependency has led to multilateral trade systems during past 50 years, which has witnessed unparalleled prosperity and economic growth ,and more has been done to address poverty in terms of social & economic imbalances, in these last 50 years than previous 500 years. For oil and gas industry ,industrial growth stimulated by enhanced trade means bigger market that will evolve into a larger global economy and will create a greater world wide demand for energy including oil and gas. So global industry leaders will support trade liberalization, i. e.- an enhanced globalization and free trade movement through cross boundary expansion . Thus the system of multilateral trade needs to be defended more strongly than ever, asserting that the energy industry has a moral obligation to defend economic growth in trade and the energy use is essential to sustainable economic development . At recent WTO meeting in DOHA, the World Bank emphasized the links between population growth, poverty and stability, and tried to relate them with current global issue on terrorism. At the center of the stability in an highly interconnected world is energy, especially oil and gas. The remedy of poverty is economic growth , which requires energy consumption. A draft chapter in World Bank's Poverty Reduction Strategy Sourcebook relates energy development goals to poverty reduction and divides relief into four categories on income, capability, security and empowerment for achieving an equitable socio - economic world order in harmony with nature and environment . Now, the basis and necessity for oil and gas demand growth has moved to a developing world, destined for large gains in population and energy use. Further, world over the stability, as everyone has seen it after sept.11, events, has become a global concern. Security , all around the globe is a growing function of global stability, and as such it depends greatly on economic development and ready access of burgeoning population to the fuels of prosperity, economic growth and social security . In the modern day of increasingly interdependent world , the essential purpose of oil and gas to feed people. Economically sustainable systems of life require economically efficient forms of inanimate energy. People need to work in order to survive and energy in order to work , which makes them dependent on the most efficient forms of energy available . To meet the challenge ahead for developing a new world order on socio-economic development, energy production and consumption with environment protection, the petroleum industry world over is shifting its emphasis to redefine growth strategies through emerging technological excellence, incorporating Portfolio, Resource And Knowledge Management, harmonizing - technology , people , and process with economic , social and environmental system integration,, from cost reduction to more diverse asset - management practices , improving oil and gas productivity with environmental and social responsibility. A new energy era seems to be emerging with the beginning of the year 2002 A. D. The NEW WORLD ENERGY ORDER is taking its birth, on a sustainable roadmap of economic development, after a long gestation at oil dependency over past five decades .

THE GLOBAL E & P INDUSTRY : FUTURE PROSPECTS

With depleting oil production , world over , at a faster rate of nearly 70 mn b/d , oil companies are thrust upon with challenging strategies for enhancing oil and gas production to arrest not only to declining oil production, but to focus on estimated average of 2% annual growth in global oil demand over the years ahead , along with conservatively estimated 3% natural depletion in production from the exiting reserves. Globally oil remains fundamentally a government business , government and national oil companies are controlling about 90% of global Hydrocarbon assets. With demanding economic growth , a fundamental challenge for E & P industry in future will be aimed to develop more reserves than production . For most

oil companies the majority of their profits come from core productive basins but many of them are now mature and it can be difficult to replace earnings with high margin exploration activity. Now most of the companies are turning to production sharing deals where they can develop reserves that are already known , but there are countries which do not have enough capital or the technology to exploit them. In changed global E& P business environment , the above ground political , commercial and environmental risks are on increasing challenges for the future sustainability of hydrocarbon industry. The other major element that is changing, is the nature of competition. The immense portfolio restructuring, through merger and acquisition, aimed at creating business excellence, cost savings, and market capitalization is taking place through out the globe to provide unexpectedly strong competition. Evidently, technology has revolutionized the oil business in the last decade with rapid advances in data interpretation, reservoir management, enhanced oil recovery, directional drilling, and deep sea water operations and the pace of advancement is accelerating as well. The oil industry is saddled with its image problem as polluting manufacturing industry when in reality it has become a knowledge based business. Its success will depend even more heavily in the future on its ability to develop and deploy new technology at integrated energy business. The future visualizes, a tremendous growth in natural gas usage in the years ahead. There are a number of factors that we believe will drive the growing role for gas on global basis, and the environment obviously, will be a key driver. Gas is the preferred fuel for power generation and there is a growing demand for gas in emerging markets like China ,India and Brazil. Companies on energy business are looking at all the sectors : Gas transmission , Gas distribution , Gas trading , Power generation , Electric utilities , even Electricity trading . In unregulated business scenario, gas and power will be growing importance in the portfolios of many energy companies . The energy business is becoming a commodity business whether it is oil or gas or kilowatts. Oil is unique in that it so strategic in nature . Energy is truly fundamental to the world 's economy. The Gulf war was a reflection of that reality. The degree of government involvement also makes oil a unique commodity . It is a industry which provides essential goods , at the lowest possible cost, with regular reliability, while still ensuring a cleaner environment. In the last century and up to the World War II , coal was the king, , it was dethroned by oil , mostly due to transportation fuels , but also because oil was less polluting and easier to handle. Coal is still with us today , but oil is clearly dominant in the new century as well . The end of oil era is not yet here , but the challenges are ahead and the industry must be ready to adapt to the new challenges and transformations that lie ahead .

ADVANCES IN E& P BUSINESS PROSPECTS : CHALLENGES AND OPPOURTUNITIES.

A new globalized socio - economic market driven consumerist system has been emerged with the dawn of new millenium. It decrees that in the 21st century, the volatile market forces shall be the guiding locomotive. Elected governments and the people must learn to live with the invisible hands controlling their lives. This model relies a lot on both , the states and markets behaving rationally in the pursuit of their legitimate interests. The energy sector today is characterized by shortage and like many developing countries world over , India will also inevitably increase its consumption of Hydrocarbon - sources , as the major fuel , in the next few decades . This is a necessity , since energy in different form is a prime mover of economic development . Hence, the structure and business orientation of petroleum Exploration and Development organizations will promise to the world community to be a key factor for the sustainability of hydrocarbon exploration and production business in the years ahead . Team concepts and application of global knowledge to local petroleum sedimentary basins are taking hold to enhance productivity of mature productive assets on one hand and reserve accretion of exploratory basins on other, to meet the challenges ahead in the energy sector of world economy . World oil and gas reserve have grown during the past decade , and the research suggests that the twice the volume of hydrocarbon reserves to be discovered as has been produced .Drilling and completion costs have been at historic high levels in the recent years and are difficult to predict even a year ahead due to uncertainties about oil and gas prices and consolidation in the integrated service and supply industry . Meanwhile, separating exploration and production functions into distinct entities might be needed to lure investors that no longer view upstream operations as a growth business . World gas reserves have grown @ 1.9% per year during the past decade compared with only 0.2% per year for oil reserves

.The gas gains were the result of a string of gas discoveries and better assessment of exiting petroleum fields. As the complexities of producing oil and gas grows , the oil and gas industry continues to seek a better understanding of producing mechanisms as well as to develop, new tools for bringing fluids to surface at a lower cost . Fields being developed and produced often are in harsh climates and deeper waters , and some reservoirs have very high pressures and temperature, low permeability, unconsolidated sands, viscous fluids ,and many a times wells are drilled with complex trajectories and multilateral drains . In mature petroleum basins , oil and gas wells become increasingly difficult to drill and complete as operators are forced to focus on deeper horizons , more difficult to find reserves , and often low quality reservoir rocks . Much of the reserves produced in the future will be beyond the capability of older , less efficient drilling equipment . Efficient and capable rigs will get exploration and development work and enabling technologies will be critical factor to an operator's success in the years ahead , as challenging wells will require greater rig capabilities and enabling technologies in the future for further exploitation of petroleum reserves.

INTEGRATED MANAGEMENT SYSTEMS FOR MINIMIZING ENVIRONMENTAL IMPACT OF OIL AND GAS PRODUCTION
Integrating and implementing quality and environmental systems can have a significant impact on the financial success of a business. The overall intent is to blend multiple management systems with QMS and EMS integration processes for streamlining entire E & P business to a single operational management system, resulting in improving profits and gaining an advantage of today's global market, in term of strategic standardization, on quality and safety, health & environment. The basic philosophy of sustainable business activity must be based on a knowledge partnership for the protection of global environment on our green planet, the earth, and respect of human dignity for the survival of human race. Unless integration and conservation measures are initiated with a sense of urgency, the world could face a serious situation on the energy front. In the context of limited financial resources, and substantial scope for a new reservoir discovery, the major challenges ahead are to impose strict demand side management on reservoir management and development evaluation and efficiency enhancement for refining and productive use of petroleum resources, by creating and sustaining an environmentally clean, and industrially safe social and congenial work atmosphere. In particular, the integration process has proven to be a very effective and cost efficient way to develop one management standard. With the preponderance of quality systems and ever increasing environmental systems, it becomes even more important to integrate all the systems into one synergistic business system. As nations and industries continue to adopt QMS and EMS systems and, potentially require their supply chain to comply, it becomes critical that all of the various elements of a business be merged as a unified structure. The paper has objectively emphasized on the theme of " Good Environment Management Makes Good Business Sense ". Over and over again, good environmental management has demonstrated its impact on improving operational and process control and ultimately, on cost effectiveness and profitability . A waste generating process can become much more efficient and profitable if we are aware that inefficiency can also increase pollution - the consequences of our mistakes can create product waste, which in most cases ends up in environmental waste. The changing diversified business environment, offers petroleum sector in general and exploration and production in particular, many opportunities and challenges in terms of widening gap in demand and supply of oil and gas, resulting in exerting pressure on E & P industry to enhance recovery from its exiting mature assets and to exploit them to their significant remaining potential. Further globalization and liberalization of economies has allowed greater operating freedom for petroleum sector in more competitive environment , resulting in restructuring of global E& P industry leading to considerable cost reduction , and emergence of independent service providers. Again , technological advancement in the global E&P activities of hydrocarbon industry , has resulted in adoption of latest technology , conforming integrated quality and environmental standards . The integration process has proven to be a very effective and cost efficient way to develop one management standard to bear the social , economic and environmental responsibilities in serving society .

E & P INDUSTRY AND GLOBAL CLIMATE

Man made emissions of green house gases causing climate change has agitated , the entire world community to lead a movement towards developing a concept of zero emission and zero effluent , for protecting globe against rise at global warming .Continued shifts in the earth's temperatures, predicted by many scientists, could dramatically affect the way we live and do business. The green house effect is the name given to the insulating mechanism by the atmosphere keeps the Earth' s surface substantially warmer than it otherwise would be . Man made emissions of green house gases occur in number of ways .For example , carbon dioxide is released to the atmosphere , when solid waste ,wood and fossil fuels - oil , natural gas and coal -are burned . Methane is emitted by decomposition of organic wastes in landfill sites , during production and transportation of fossil fuels , by agricultural activities and by dissociation of gas hydrates. Nitrous oxide is released to the atmosphere during the combustion of solid wastes and fossil fuels . All these noxious emissions are responsible for global warming and in turn affecting the natural climate . In July 2001, in the third assessment report of the United Nations Intergovernmental Panel On Climate Change (IPCC ), the leading scientists around the world expressed a consensus view that ,"most of the observed global warming over the past 50 years ,is likely to have been due to increase in green house gas concentrations ." An important and influential segment of the global scientific community believes that the human activity has contributed to the rise in the Earth 's average surface temperature and a resulting world wide climate change. It is true that in the short and medium term , the world will continue to depend upon fossil fuels as a cheap energy source , so there is a growing interest in methods to control carbon dioxide emissions. For years, carbon dioxide has been injected into operating oil fields to enhance oil recovery, and normally it remains in the formation. The use of depleted oil and gas reservoirs for carbon dioxide storage, however has a further advantage in that the geology is well known , so disposal takes place in areas where formation seals can contain the gas. Today many oil and gas companies are taking global warming seriously ,convinced that it is essential to adopt a precautionary approach . Integrated oil companies are also trying to help customers to reduce green house gas emissions .,by increasing the availability of fuels with lower carbon content and offering renewable energy alternatives, like solar and wind driven power. Working with Oil & Gas companies, major oil field service suppliers have also been at the fore-front in addressing a range of health, safety and environment issues - from reducing personnel exposure to risk at the well site to the application of "green" chemicals that provide equal or enhanced performance, while decreasing ecological impact and to the methods for cutting or eliminating emissions resulting from processes such as burning oil and flaring gas during well testing operations. Carbon sinks and storage are two environment friendly ways for mitigating the impact of carbon dioxide emission. Carbon sinks are newly planted forests where trees take carbon dioxide from the atmosphere as they grow and store it in their branches, trunks and roots. If too much carbon dioxide is being pumped into the atmosphere by burning fossil fuels, discharge levels can be compensated for, to some extent, by planting new trees that soak and store carbon dioxide. In 1995, the IPCC estimated that some 345 million hectares (852 million acres) of new forests could be planted between 1995 and 2050 that would sequester nearly 38 gigatons of carbon. These actions would offset about 7.5% of fossil fuel emissions. The IPCC added that other measures, like slowing tropical deforestation, could sequester another 20 to 50 gigatons of carbon. Taken together, new forests, agro-forestry, regeneration and slower deforestation might offset 12% to 15% of fossil-fuel emissions by the year 2050. An attractive feature of this approach is that, if implemented globally, it buys time during which, longer term solutions can be sought to meet world energy needs without endangering the climate system. Further, if the carbon dioxide can be separated from the gases- at present an expensive process, - it can be stored rather than released to the atmosphere. Storage could be provided in the oceans, deep saline aquifers depleted oil and gas reservoirs, or on land as a solid. Oceans probably have the greatest potential storage capacity. The first commercial-scale storage of carbon dioxide in an aquifer began in 1996,in the Sleipner

natural gas field belonging to the Norwegian oil company- Statoil. The Sleipner carbon dioxide sequestration project has inspired other oil and gas companies to consider or plan similar efforts in South East Asia, Australia and Alaska. Recent scientific advances have further augmented in developing computer simulation of global climate system, and pro-active steps are being taken by oil and gas companies and service providers to reduce the impact of oil field operations on climate change.

A MOVEMENT TOWARDS EMISSIONS ' TRADING An approach to Zero emission - oil field operation.
The need to reduce green house gases has evolved from an environmental issue to a business and energy issue. Mechanisms such as emissions trading will allow companies and countries to meet their abatement targets. The Kyoto Protocol calls for an over all reduction of green house gas emissions of at least 5% by 2008 to 2012, compared with 1990 level. World-over E&P companies are taking challenging initiatives to cut emissions in several different ways, such as: By ensuring that nothing escapes into the environment that can be captured and, ideally, used elsewhere. This includes stoppage of the deliberate venting of methane and carbon-dioxide wherever possible. This may involve redesigning or replacing equipment and identifying and eliminating leaks. By improving energy efficiency. World over Engineers are devising energy generating equipment to ensure that the users are making the best possible use of hydro carbon fuels and the heat that is a by-product of energy generation. By eliminating routine gas flaring. It is better to flare gas than vent it directly to the atmosphere, but it is still a waste of hydrocarbons - although some flaring may still be necessary for safety reasons. By developing technology to separate carbon- dioxide from gas mixtures, then reuse it for enhanced oil recovery or store it in oil or gas reservoirs that are no longer in use.

Some oil companies have introduced internal green house gas emissions trading systems. The attraction of emissions trading is that it allows reductions to be achieved at the lowest cost. Companies for whom emissions reductions are cheap can lower emissions and sell emissions rights to the firms that would have to pay more to decrease emissions. The Kyoto protocol has already listed three mechanisms by which the countries, and by implication corporations, could find cost effective options of meeting green house gas emission targets, international emission trading, joint implementation to meet emissions reduction obligations, and the clean development mechanisms. With growing emphasis on eliminating all types of emissions, particularly carbon dioxide, areas of investigation on emissions reductions are expected to continue to receive close attention and significant industry funding. The future will be more focused on paradigm shift to zero-emissions oil-field operations by implementing energy efficiency, renewable and clean energy technology projects and introducing carbon accounting system, for preservation of biodiversity, eco system and natural environment on the green planet, the mother earth. In the near future, governments around the world will receive the IPCC Synthesis Report which will attempt to answer the most pivotal question on extent and timing of the introduction of a range of emissions-reduction actions that will determine and affect the rate, magnitude and impacts of climate change, and consequently will affect global and regional economies, taking into account historical and current emissions. In the interim, oil and gas companies, working closely with oilfield service companies,

will continue to be proactive in developing technologies and operational procedures for reducing and eliminating emissions.

RECASTING AN ECONOMY FOR THE EARTH A MONUMENTAL UNDERTAKING ON ECO-ECONOMY

Treating the environment as the part of the economy has produced an economy that is destroying its natural support systems. Converting our economy into an eco-economy is a monumental undertaking. There is no precedent for transforming an economy shaped largely by market forces into one shaped by the principles of ecology. The scale of projected economic growth outlines the dimensions of the challenge. The growth of world output of goods and services from $6 trillion in 1950 to $43 trillion in 2000 has caused environmental devastation on a scale that we could not easily have imagined a half-century ago. If the world economy continued to expand at 3 % annually, the output of goods and services would increase fourfold over the next half century, reaching $172 trillion. Although the concept of environmentally sustainable development evolved a quarter century ago, not one country has a strategy to build an eco-economy - to restore carbon balances, to stabilize population and water tables, and to conserve its forests, soils and diversity of plant and animal life. We can find individual countries that are succeeding with one or more elements of the restructuring, but not one that is progressing and satisfactorily performing on all fronts. Nevertheless, glimpses of the eco-economy clearly visible in some countries. For example, most of the countries of Europe and Japan have stabilized their population size, satisfying one of most basic conditions of an eco-economy. Among the countries, Denmark is the ecoeconomy leader. Under eco-economy philosophy it is still not close to balancing carbon emissions, and fixation, but it is moving in that direction. The concept of eco-economy is highly optimistic to rework on existing structures to make it compatible with the earth's ecosystem, where the wind farms will replace coal mines and hydrogen powered fuel cells will become the new engines of economic growth. Restoring the balances of nature is a huge undertaking. For energy, it depends on shifting from a carbon based economy to a hydrogen - based one. Even the most progressive oil companies , such as BP and Royal Dutch Shell, that are talking extensively about building a solar/hydrogen energy economy, are still investing overwhelmingly in oil. Building an eco-economy will affect every facet of our lives. It will give us a world where we are a part of nature, instead of estranged from it.

APPLICATIONS OF DECISION TREE ANALYSIS AND PORTFOLIO MANAGEMENT TOOLS FOR PETROLEUM E & P INDUSTRY .
In the present complex scenario of business environment world over, advanced technologies are now available to analyze, govern and derive all technical, economic, social and environmental decisions in the hydrocarbon industry as well. As a new methodology ,one solution is decision tree analysis , which is well applicable to oil and gas industry and helping decision makers to prioritize their complex problems . It is further helping to understand the impact of all related factors that influence the decision by evaluating uncertainty, and quantifying the value of new information to build confidence in designing a frame-work for more difficult and multidisciplinary problems , and validating it for a sound techno-economic decision ,balancing environmental and social responsibility with economic analysis . As the petroleum E & P industry continues to pursue hydrocarbon prospects in more remote and potentially sensitive regions , decision making tools that incorporate information from all sources of expertise will make important contributions to the growth of oil and gas industry . Capturing the essence of a problem by determining the affecting factors helps decision makers concentrate on only those issues that play a major role in the outcome . Such sensitivity analysis prioritizes the importance of factors to be considered in a decision . In socioeconomic aspects the factors may include social and environmental accounting with economic benefits .

Decision -analysis products help identify how sensitive a decision is, to all the factors involved, determine the value of moving ahead or gathering data, point decision makers in the most valuable direction, and finally produce more consistent decisions . The benefits of a consistent decision analysis process allow the decision makers to increase the efficiency of their technical staff and value of their work. At integrated oil companies, world over, decision tree analysis tools are widely used to combine technical and economic information to promote sound decisions in field development programs and economic analysis . In addition , the petroleum industry is now able to extract advantage of asset management techniques, that view industry ,society, environment and economics as interdependent portfolio . Globally , vertically integrated oil industries are using portfolio optimization and opportunity management techniques to meet targeted levels of production revenues, reserves and other social and environmental objectives . Portfolio management offers a methodology for decision makers to evaluate petroleum asset portfolios, asses the likelihood of meeting objectives and bridge the gap between the targets and the result attainable under the current strategy . A knowledge sharing corporate culture in today's E&P industry environment has improved the productivity and financial performance substantially by maximizing asset value and strengthening competitive position in a dynamic market place.

ADOPTION OF ENVIRONMENTAL PERFORMANCE AS CORPORATE SOCIAL REPONSIBILITY

A company's existence is closely bound up with the global environment as well as with the community it is based in. In carrying on its activities, each company must have respect for human dignity and strive toward a future society where the global environment is protected. With an object to attain global ecocompetitiveness, world over the E&P industry must aim to focus on green business opportunities, and construct a society whose members co-operate together on environmental problems, a society where sustainable development on a global scale is possible, where companies enjoy a relationship of mutual trust with local communities, where they vigorously and freely develop their operations while preserving environment. The Petroleum E&P industry must also aim at being a good global corporate citizen, recognizing that grappling with environmental problems is essential to its own existence and its activities. Further, the system integration process, on the charter of sustainable development for the survival and strategic growth of E&P industry requires to assess, the progress of sustainable development in terms of financial requirements and other economic systems to share the best sustainable development practices and to build a better sustainable development infrastructure, by adopting, environmental performance as its corporate social responsibility and as such world over a new system of integrated work-culture has to be created and established among the petroleum business communities as well, to minimize environmental impact of oil and gas production aimed at to focus on reducing social and economic imbalances in the larger interest of the world community. The integration process has proven to be a very effective way for achieving the targets of sustainable development, while conserving the natural resources and protecting the environment.

TRANSLATION OF CUTTING EDGE TECHNONOLOGIES INTO ENVIRONMENTAL BENEFITS

Further, with the advent of modern tools of cutting edge technologies, globally the petroleum E&P industry has now focused its attention on bio-technology applications, IT based environmental and process management solutions, to facilitate the petroleum industry's assess to environmental information on biodiversity, sensitive areas and protected regions. Developed by UNEP, World Conservation Monitoring Center, in partnership with IPIECA, the International Petroleum Industry Environmental Conservation Association, the I-maps service can provide with internet access to the world's most comprehensive bio-diversity data set. I Maps are being further expanded and upgraded to incorporate globally accessible environmental data, and UNEP-WCMC is seeking further oil industry partnership to achieve this goal. As part of the United Nations Environment

Programme, UNEP-WCMC is committed to providing the worlds most comprehensive and accessible source of environmental data. IPIECA continues to work closely with UNEP-WCMC and is channeling support to expand the regional coverage of the I Maps system and to ensure that users within the oil industry are aware of its benefits.

CONCLUSION : A PARADIGM SHIFT TO MINIMISE SOCIAL , ECONOMIC AND ENVIRONMENTAL IMBALANCES

In the changed perspective of global market scenario petroleum industry is now seeing that good environmental and social performance can be an extra business opportunity and not an extra business overhead . The overall intent of integrating environmental , social and economic systems is to an operation with multiple management system , blend them and end up with one operational management system. The blending and integration process is essential for streamlining processes , improving profits ,and gaining an advantage in today's global market . Now in the new millenium ,the petroleum industry ,world over is dedicated to continuous efforts to improve the compatibility of its operations with the environment while economically developing energy resources and supplying high quality products and services to consumers and society .The industry has recognized its responsibility to work with the public ,the governments and others to develop and use natural resources in an environmentally sound manner while protecting the health and safety of its employees and public . The paradigm shift through social , economic , and environmental system integration ,in hydrocarbon industry, with knowledge partnership, to preserve the integral nature of our green planet ,minimizing social ,economic and environmental imbalances ,and to focus on the producing and exploratory petroleum assets to maximize to meet the global energy demand of progressive world economy .
DR. J. P. N. GIRI. , ONGC. INDIA.