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Chapter 3

Research Design

3.1 Introduction

A research design is a basic plan that guides the data collection and analysis

phases of the research project. It provides the framework that specifies the

type of information to be collected, its sources and collection procedure

(Kinnear & Taylor, 1996; Churchill & Iacobucci 2005) define research design:

“it is the blueprint that is followed to complete the study” and it “ensures that

the study is relevant to the problem and will use economical procedure”.

While conducting the present study, care has been taken to incorporate these

concepts in the research deign. There are many frameworks of research design

which can be classified into two major categories: Exploratory and

Conclusive. The conclusive research can be further divided into descriptive

and casual research (Seth Ginsburg, 2011). Figure 3.1 gives the flow diagram

of research design.

Exploratory research is more to do with qualitative study while conclusive

research is associated with quantitative study. The qualitative research provide

insight and understanding of the problem setting, while quantitative research

seeks to quantify the data and typically applies some form of statistical

analysis. Whenever a new research problem is being addressed, quantitative

research must be preceded by appropriate qualitative research. (Mery Klupp,

2011) In this thesis, both these research designs have been employed in

different degrees.

For research objective-1, exploratory research has been employed with non-

probabilistic and judgmental sampling as the knowledge about Shale Gas is

still limited globally. For research objective-2, descriptive research has been

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used with non-probabilistic and judgemental sampling. For research objective-

3, a qualitative research has been employed.

The research questions were framed keeping the objectives of the research in

consideration. The research questions are followed by formulation of research

methodology, identification of sampling procedures (sampling frame, sample

size), scale formation, followed by validity and reliability tests of the

instrument (pilot testing), data collection and analysis of the data collected.

Hence, the research design used for this research work is exploratory research

for identification of variables followed by descriptive research design – single

cross sectional design for sampling and data collection. Figure 3.1 gives the

path followed in this research work.

Fig. 3.1: Research Design Concept

(Source: Seth Ginsburg (2011) and additions by researcher)

Exploratory Research

Design

Qualitative Research

Conclusive Research

Design

Quantitative Research

Causal

Research

Descriptive

Research

Research Design

Cross Section

Design

Longitudinal

Design

Time Wise

Variation

At one time

perception

Single Cross Sectional

Design

Multiple Cross

Sectional Design

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3.2. Need for the study

India’s growing economy is expected to continue its increasing momentum

into the foreseeable future. The economic growth has a close link with the

energy requirement or to say the energy growth. To sustain this growth, the

energy sector needs to prepare itself for making available required energy

resources for sustainable growth.

The content of various energy resources in the overall energy basket is shown

in Figure 3. 2 and Table 3.1 ( BP, 2013):

Fig. 3.2: Energy Basket Global v/s Indian - 2012

Table 3.1: Energy Basket Global v/s. Indian (BP 2013)

Energy Resource Global (in %) India (in %)

Coal 29.9 52.9

Oil 33.1 30.5

Natural Gas 23.9 8.7

Hydro 6.7 4.7

Nuclear 4.5 1.3

Renewable 1.9 1.9

Total 100% (12476.6 MTOE) 100% (563.6 MTOE)

The environmental concern for polluting fuel is on increase in India as in the

global arena. More than 70% of the oil consumption and 30% of gas are

imported, putting heavy burden on the country’s economy.

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The environmental awareness coupled with economy and efficiency in natural

gas application, it’s demand is huge and the assessment of the demand supply

gap projection indicates that on an average two third of the demand remains

unmet (Integrated Energy Policy 2006). The US success story of Shale Gas

Exploration is not only a game changer but an eye opener for the professional

associated with gas sector or energy sector. It is in this context that a need is

urgently felt to analyze as to why India has not yet embarked on Shale Gas

Exploration in the country, and therefore, this research.

3.3. Statement of Problem

India has a huge gap in the demand and supply of natural gas, its domestic gas

reserves are limited and various E&P operators have found Shale Gas reserves

(By accident - Joshi Technology, Cambay Basin), by experimentation (RIL in

Cambay and ONGC in Damodar Basin). With the proven success of US Shale

Gas program, it is not understood as to why India has not undertaken Shale

Gas E&E even though India has sizable Shale Gas reserves. It is therefore felt

necessary to study the various issues by leveraging the experiences of select

countries like US, Canada, China, and Poland etc in this sector; which could

analyse the state of Shale Gas E&E in India. Such issues when addressed will

encourage Shale Gas E&E in India which then becomes a motivation to

identify the factors that prevent the implementation of Shale Gas E&E in

India, thereby providing solutions to the identified barriers and to encourage

the exploration & exploitation in this sector in India.

3.4 Research Questions

During the literature review, the following research questions have been

identified that need to be answered through this research work.

Central Research Question (RQ): What are the factors that influence the

Shale Gas E&E in India? Which of such factors are the barriers that prevent

Shale Gas E&E in India?

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Additional RQ1: What practices can be adopted by Indian Shale Gas E&E

industry from the experience of other countries?

Additional RQ2: What frame work India should develop for effective

implementation of Shale Gas E&E in India?

3.5 Objectives of the Study

The following are the objectives of the research work:

1. To identify the factors those influence Shale Gas E&E in India.

Also to identify the barriers from such factors those prevent Shale

Gas E&E in India.

2. To identify the practices that could be adopted by Indian E&E from

global experience. (by studying the growth of Shale Gas E&E in

USA, Canada, Europe, China and Australia)

3. To formulate a suggestive framework for effective Shale Gas E&E

in India.

3.6 Scope of the study

The scope of the study is restricted to Indian geographical boundary with

focus on the sedimentary basins expected to contain Shale Plays.

3.7 Research Model

To find the solution of the research questions, an appropriate research model is

framed. As the nature of the study is such that the target population from

which information can be obtained is limited both with respect to extent and

quality of information, therefore an experimental research design (quantitative

research) model is used in this study (Creswell, 2009).

The questionnaire has been developed with the input from literature survey

and modulated with the inputs from peers. Each variable of the questionnaire

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is assessed with 7-point likert scale to get data for processing through

statistical tool. The data collection is based on single cross sectional design

(Figure 3.1). The research model is explained in the flow diagram Figure 3.3.

Fig. 3.3: Research Model

3.8 The philosophical world view proposed in the study

The present research work has characteristics of post-positivist worldview.

The research work adopts a scientific way of doing research, holds a

deterministic philosophy of cause and effect (causal effect of policy - growth

of exploitation of Shale Gas, etc.), and identifies the causes that influence

outcomes. It is reductionist in the intent to reduce ideas into a small, discrete

Review of Literature

Variables Identification Secondary

Information Expert

Review

Design Questionnaire Pilot Test

Instrument Reliability

Instrument Validity Questionnaire Final

Data Collection

- Survey

Factor Analysis

– Data Process

Results

Conclusions and

Recommendations

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set of variables that encompass business problem, research problem and

research questions. Collection of data on the instrument (questionnaire) based

on measures (Likert Scale) completed by participants to develop relevant

understanding of causal relationship of interest, adhering to the standards of

reliability and validity, use of deductive logic are some of the hall marks of

this worldview (Creswell, 2009).

Similar process has been adopted in this research work making it closely

aligned with the post-positivist worldview. Compared to that, the pragmatic

worldview emphasizes the research problem and uses all the approaches

available to understand the problem (both qualitative and quantitative methods

are adopted) (Creswell, 2009). In this research work, in a limited way

qualitative approaches (expert views) have been incorporated with a

predominantly quantitative method of data analysis giving it a mixed method

flavor of research. However, the research work is more closely linked to the

concepts of post-positivist worldview – although these worldviews are not as

mutually exclusive as they appear initially (Creswell, 2009).

3.9 Strategies of Inquiry

The strategies of inquiry are the types of qualitative, quantitative and mixed

methods designs or models that provide specific direction for procedures in

research design (Creswell, 2009). In this research work, exploratory research

design (qualitative research) has been used for identifying the variables. The

questionnaire containing the variables has been given to target population and

the data collected using descriptive research is analyzed though statistical tool

(SPSS 16.0) to identify the factors that influence Shale Gas E&E in India.

Further discussion on the factors so emerged has been done to find the factors

which work as the barriers to Shale Gas E&E in India.

The lesson learnt from global experience and the additional input received

through the questionnaire have been utilized for implementation by Shale Gas

Industry in India. How this information will be absorbed in the Indian Shale

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Gas E&E has also been described. Finally, a frame- work is created taking into

consideration the factors emerged from the research study and the global

experience.

3.10 Research Methodology

There being three objectives of this research study appropriate research

methodology has been applied to each of the objective. The methodology

applied for research Objective -1 is:

3.10.1 Exploratory Research

Exploratory research (qualitative research) is employed to develop initial ideas

and insights and to provide direction for any further research needed

(Churchill & Iacobucci, 2005 ; Aakeret. Al. 2007). An exploratory study is

essential when a researcher needs to identify problems, defines the problem

more precisely and identifies any specific objectives or data requirements to

be addressed through additional research (Kinnear & Taylor, 1996).

The exploratory research is highly flexible, unstructured and qualitative

(Aaker et. al. 2007). Exploratory research was carried out by a study of

literature survey and input from the peers.

3.10.2 Descriptive Research

Having obtained some primary knowledge of the subject matter by an

exploratory study, descriptive research was conducted next. Descriptive

Research renders itself to analysis using statistical tools. Contrary to an

exploratory research, a descriptive study is systematic, fixed format and

structured (Churchill & Iacobucci, 2005). According to Kinnear & Taylor

(1996), “descriptive research is appropriate when the research objectives

include (1) portraying the characteristics of marketing phenomena and

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determine the frequency of occurrence, (2) determining the degree to which

marketing variables are associated and (3) making predictions regarding

occurrence of marketing phenomena”. The research objectives of the study

match the two types of objective. Further the descriptive research (Figure 3.1)

can employ cross sectional or longitudinal design for survey. In the cross

sectional design information is collected from a given sample of the

population at only one point of time while in longitudinal design the sample

units of population are contacted over different period of time (Kinnear &

Taylor, 1996, Churchill & Iacobucci, 2005 & Seth Geinsburg, 2011). For the

purpose of this research a single cross sectional design was adopted as

longitudinal study would not only have taken considerable time but the

possibility of the same population being contacted again would have practical

constrains. The sampling used has been non-probabilistic design using

judgmental sampling (Figure 3.4).

For objective number two, descriptive research methodology has been used

with non-probabilistic deign and judgmental sampling the experience gathered

from the literature has also been utilized (Figure 3.5).

Fig. 3.4: Research Methodology for Objective -1

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.

Fig. 3.5: Research methodology for Objective -2

Further the qualitative research has been used for addressing objective number

three where tabulated data and text from literature survey and primary surveys

from peers has been used to develop a suggestive theoretical frame work for

implementing Shale Gas E&N in India (Figure 3.6).

Fig. 3.6: Research Methodology for Objective -3

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3.11. Sampling Procedure

The sampling procedure adopted is described below elaborating the target

population, sampling elements, sampling unit, sampling frame, sampling

techniques and sample size

3.11.1 Target Population

Population is the aggregate of all elements that show some common set of

characteristics and that comprise the universe for the purpose of the research.

The population parameters are typically numbers (unit) (Chuck Chakrapani,

2011).

Target population is the collection of elements or objects that possess the

information sought by the researcher and about which inference are to be

made. The target population must be defined in terms of elements, sampling

unit, extent & time.

In the present research, the target population for the survey is any organization

or individual having interest in the Shale Gas in India and world over. This

includes companies that have an active presence in India and all those who are

keen to set up base in India to exploit the Shale Gas potential offered by the

country. Such population would comprise of the Policy makers, Regulators,

Consultants, Service Providers, Equipment Suppliers, Companies in E&P

activities both from Public Sector and Private Sector, and Academia. In

addition, the global experts with experience in Shale Gas were also added to

the list of respondents which included EPC contractors, Shale acreage owners

in US, thought leaders in Shale Gas E&E, developers of new techniques and

chemical formulation for directional drilling, fracking fluid and propellants

etc. Organizations and individuals who do not have any idea about Indian

sedimentary basins and are only in the exploratory mode with no immediate

timeframe to set up base in India were excluded from the analysis though their

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opinion was sought on the specific areas of their specialization and such

response have not been included in the compilation.

3.11.2 Sampling Elements

A sampling element is the object about which or from which the information

is desired in survey research. The element is usually a respondent. In the

present study, the survey is designed to elicit perspectives on various traits or

aspects which have been or likely to influence the Shale Gas E&E in India, the

sampling elements encompass officials holding or who have held the position

of decision making in the sector, or have the knowledge of the Shale Gas

revolution and its likely impact/influence Indian Shale Gas program. The

sampling element is thus defined as people those who are (were) in the

executive decision making authority in their respective

companies/organization, middle management and junior management

professionals who are associated in decision making, contractors, service

providers and academia from Petroleum and Energy constitute the sampling

elements.

3.11.3 Sampling Unit

A sampling unit is an element or a unit containing element(s) that is available

for selection as a respondent at some stage of the sampling process. To better

understand sampling elements and sampling unit, an example is cited: Suppose

Revlon wanted to assess consumer response to a new line of lipsticks and

wanted to sample female over 18years of age. It may be possible to sample

females over 18 years directly, in which case sampling unit would be same as

sampling element. Alternatively the sampling unit could be the household. In

the later case all household (female over 18years) would be sampled. Here

element is a female but unit is household.

For the present research, sampling unit is an individual in executive

leadership roles in Government (policy making) Ministry of Petroleum and

Natural Gas, Planning commission, Regulatory bodies like DGH and PNGRB,

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Public and Private organizations (Both Indian and Multinational) with interest

in Shale Gas E&E in India, officials who actively participates in large

industry conferences as speakers or panel discussions experts, moderator or as

session chair in national and international conferences, the academia pursuing

Shale Gas at B. Tech (Petroleum Engineering) and MBA (Oil & Gas) and the

faculties teaching Hydrocarbon Exploration and Production including

conventional and non-conventional resources.

Since thought leaders from hydrocarbon industry are usually invited to various

conferences and the researcher had the opportunity to teach in few of the

Petroleum and Energy Universities and participated in Shale Gas World

Conference in Poland (Dec. 2010), in China (June 2011), in Singapore (2012)

and in India (Nov.2010, 2011, 2012 and 2013), access to these leaders and the

professionals became possible for the response collection exercise. Thus the

sampling unit became robust and exhaustive with target population really

global

Thus in the present research study sampling element and the sampling unit are

one and the same.

3.11.4 Sampling Frame

Sampling Frame is the representation of the elements of the target population.

It consist of a list or set of direction for identifying the target population such

as telephone directory, published list of the stakeholder, etc. (Chuck

Chakrapani, 2011). The respondents selected have a stake in Shale Gas in

India and who have an active presence or business interest in India was

identified as part of the sampling frame.

In the present case, the sampling frame consist of DGH document containing

all E&P Organizations, Service provider, Consultants, Policy Makers,

Regulators and Academia, (globally) through express knowledge or through

directory of the association (FICCI, CII, ICC, PETROFED, SCOPE, etc),

newspaper or periodicals.

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3.11.5 Extent

The extent refers to the geographical boundaries of the target population. In

the present survey, the extent of data collection exercise was unrestricted as

the Shale Gas movement is rather new area of opportunity and global

awareness of all possible Shale Gas plays is being keenly observed by all

concerned. More over the multinational players are actively involved in global

Shale Gas exploration. The only consideration for data collection in the form

of response to the questionnaire was the knowledge about Shale Gas

Exploration in general and Indian E&P scenario in particular. Therefore the

questionnaire has the response from all nationals from across the globe.

3.11.6 Time Period

The data collection exercise was spread over later part of 2011 to March,

2013. However, data updating has been a continuous process.

3.11.7 Sampling Technique

Stratified sampling was used during the data collection process. The

population was divided into different strata (Policymakers and Regulators,

Public Sector Organizations, Consultants and Service Providers, Academia,

and Private Sector Organizations engaged in hydrocarbon E&P business) and

number of elements from each stratum in selected based on the available units

(elements) in that strata. The exact percentage of these stakeholders in the

sample size is given below in table 3.2.

3.11.8 Sample Size

To calculate the sample size needed for the research, Yamane’s (Yamane,

1967) formula is used. Overall 2500 people were identified as the target

population for the survey, those who had interest in Shale Gas exploration.

Incorporating N = 2500 and e= 0.05 in the above equation, sample size was

arrived at 340. Originally the questionnaire was administered to 400

respondents but some of the responses received were incomplete. So, those

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who submitted incomplete questionnaire were removed from the list. Finally,

341 respondents were found to have submitted their responses that were

complete in all respects - a response rate of 85%. Response rates of, in person

administering of questionnaire is around 60% to 80% as per (Shosteck and

Fairweather 1979); Baim (1991); Shaver & Brennan (1992) and Goyder

(1985). Also to conduct factor analysis, it is the norm (Malhotra, 2010) to

have 8 respondents for each variable. In this survey there are 42 variables

which would need 336 respondents to participate in the survey. 341

respondents are higher than the number needed to do factor analysis and

therefore satisfy that condition. The breakup of the respondents is shown in

table 3.2.

Table 3.2: Break-up of the Respondents to the Questionnaire

Type of Respondents Number of

Respondents

% of the

Total

Policy Makers & Regulators 39 11

PSU companies 51 15

Consultants and service

providers 55 16

Academia(faculties, Students

and Researchers) 127 38

Private Sector Companies

including multinationals 69 20

Total 341 100

In the pictorial form, the strata of the respondents are shown in Figure 3.7.

Fig. 3.7: Break-up of the Respondents to the Questionnaire

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3.12 Instrument design

The instrument that was used in the data collection exercise for the research

was a questionnaire which contained 42 questions with pre-defined choices on

seven point likert scale and few (3 questions) open ended questions

(Questionnaire is shown in Appendix-C). The details of the instrument

development, scale formation, questionnaire format, data collection, validity

and reliability test are mentioned in the subsequent sections.

3.12.1 Questionnaire development

Structured – undisguised questionnaire was used in the survey - as they are

reliable, standardized, simple to administer, easy to tabulate and analyze -

where the responses permitted to the respondents were predetermined on a 1-7

likert scale (Vagias, Wade M 2006). There were 3 open questions to let the

respondent answer in their own words.

3.12.2 Information sought

The list of variables found from literature survey (variables and their operating

definitions is explained in Appendix-D) was presented to the respondents in

the form of questions and they were asked to choose an option (in the 7 point

likert scale), how a particular variable would influence the E&E of Shale Gas

in India (Strongly disagree to strongly agree rating).

Towards the end of the questionnaire (attached as Appendix-C in this thesis)

the respondents were asked to give their qualitative observation on three

questions, namely;

(i) To the best of your knowledge which of the countries experience in Shale

Gas Exploration & Exploitation can be replicated in Indian context (USA,

Europe, China, Australia, None, Can’t Say)

(ii) In your opinion which is (are) the most problematic issue(s) influencing

Shale Gas Exploration in India?

(iii) Please give your kind suggestion(s) for implementing Shale Gas

Exploration & Exploitation in India.

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3.12.3 Method of administration

The questionnaire was handed over predominantly in person at Shale Gas

conferences in India and abroad, so that access to the right stakeholders and

their response rates could be better compared to mail interview. The

respondents completed answering the questionnaire at their convenience.

Questionnaire were also handed over during one is to one meeting with senior

officials of the Government, Planning Commission, Regulatory Board, Oil

PSU’s, Chief Executives, Private Sector Oil Companies Senior Executive and

HOD in Academic Institutions. Questionnaires were given to the student

pursuing Petroleum Engineering, MBA Oil & Gas in their class room and

were also sent by email to various other stake holders.

3.12.4 Instrument reliability

Reliability is concerned with the consistency of the measurement, which

means whether the questions in the survey get same type of response when the

conditions remain the same. Reliability is also associated with internal

consistency, which means whether the same characteristic is measured by

different persons. There are four ways to estimate the reliability of the

instrument (questionnaire). They are Inter-rater (assessor) or Inter-observer

reliability, Test-retest reliability, Parallel-forms reliability and internal

consistency reliability. Each of these estimates evaluates the reliability of the

questionnaire differently. Among these, the internal consistency is the most

frequently used method to validate the reliability of the instrument and the

same has been used in the present case.

3.12.5 Instrument validity

Validity deals with how accurate the measurements are per se, and also a

reflection of sample representativeness. Validity is impacted by robustness of

survey design and whether right questions are asked to, and understood by, the

respondents. ‘Whether the instrument is measuring what it supposed to

measure’ is the core of validity estimation. The instrument has qualified the

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discriminant validity criterion, convergent validity criterion and concurrent

validity criterion (Construct Validity – Criterion).

3.13 Pilot Testing

The questionnaire was pre-tested with 30 Shale Gas Exploration stakeholders

(respondent) in the country during an International conference. The responses

were added in a dummy table to make sure the questions were understood

correctly and the answers were in line with the questions asked. A couple of

ambiguous questions were re-worded, order of the questions were changed as

per the feedback received before the questionnaire was administered again.

3.14 Quantitative Analytical Tool Used

In this research two prime objectives of statistical analysis were to reduce the

set of variables into fewer numbers of manageable factors. As stated earlier,

there are 42 variables in this study whose interdependence was examined to

reduce them to a set of 12 factors. SPSS 16 software was used for analysis.

3.15 Operating definition of the variables found from literature survey

The operating definition of the variables found from literature survey is placed

at Annexure-D, with a view to give a common understanding and better

clarity on what they mean. All these variables are independent variables which

load on 12 factors (as shown in factor analysis chapter-4).

.