1. ONGC KG basin plan hits a speed breaker

ONGC KG basin plan hits a speed breaker

DGH objects to joint development of G4 & 98/2 fields

By: | New Delhi | Published: February 12, 2015 1:20 AM

In a set back to ONGC, upstream regulator Directorate General of Hydrocarbons (DGH) has objected to joint field development of nominated area G4 along with NELP block KG-DWN-98/2 in the east coast. The PSU explorer was targeting to jointly develop G4 and the northern discovery area of the 98/2 block and first hydrocarbon production is expected by 2018.

“The DGH has raised the objection owing to inadequate geological data of the G4 area and so asked ONGC to prepare field development plan for northern area of the NELP block,” a senior petroleum ministry official told FE.

Petroleum minister Dharmendra Pradhan has asked ONGC to finalise the field development plan for its east coast project by March. Failing to jointly develop the acreages in Bay of Bengal waters may be a big dampener when ONGC has announced plans to hike its natural gas output by 81% by 2019-20.

Currently, ONGC drills about 65 million metric standard cubic metre per day (mmscmd) of natural gas, which would go up to 116 mmscmd by 2019-20. The incremental production is expected from KG basin (KG-DWN-98/2), G4, Vashistha, Bassein and Daman fields.

The government-owned explorer, in the first phase, targeted to inter-connect three acreages to a single processing terminal — KG-DWN-98/2 (which is divided into northern and southern areas); Vasisth field clusters and G4 in the same waters. The KG-DWN-98/2 was bagged under NELP auctioning, while Vasisth and G4 acreage are allotted to the explorer in the pre-NELP era.

The northern area of the NELP block along with the pre-NELP areas are estimated to hold about 3.5 trillion cubic feet (tcf) of gas and 100 million tonnes of crude oil. At the peak production, which is generally achieved after three-four years of the fields put under production, the acreages are expected to produce 27 metric standard cubic meter per day (mmscmd) of gas and 75,000 barrels of oil per day (bopd).

ONGC’s most-talked-about project in KG basin deepwaters is advancing and Intec Sea of Malaysia has been assigned to prepare field development plan.

The biggest exploration company in India saw it stand-alone crude oil output falling from 24.67 million tonnes in FY10 to 22.25 million tonnes in FY14. Similarly, gas output has increased marginally from 23.11 billion cubic metres in FY10 to 23.28 billion cubic metres in FY14. The delay in implementation of several projects is making ONGC struggle to resist the falling output from aging fields and no incremental production is coming from new blocks bagged under the New Exploration Licensing Policy (NELP) auction.

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