Speaking at the Chemtech World Chemcon'98 in Mumbai, he said that the oil exploration and production sector has huge potential which is yet to be tapped. Of the expected oil reserves of 28 billion tonnes, only 6.5 billion tonnes has been located, he added.

The current oil production is a result of production from only 22 per cent of the known oil reserves. Survey has not been conducted in 46 per cent of the area, while in 16 per cent it is poorly done and exploration has just started on the remaining 16 per cent. Considering that one-third of the country's foreign exchange is used for POL imports, the secretary said that the sector needs to be developed urgently. Considering the expansion in refining capacity, crude oil imports at the current levels of oil production growth rate is expected to be 115 million tonnes by2006.

In order to increase the oil production, the secretary said that he was willing to shut down the Neelam oilfields located at Bombay High for a period of two years, which happens to be the biggest oil field in the country. Though this would lead to a drop in production, the secretary said this was the right time as crude oil prices in the international markets are near their decades low.

Derek Corbishley, managing director of Shell India Production Development BV said that oil recovery in India has been very low as compared to world standards. In India oil recovery is in the range of 22 to 26 per cent, while that of the Brent oil fields in North Sea is currently at a low of 56 per cent. At these levels production of crude oil is expected to be stopped and the well is likely to be used for the production of gas. The reason for the low oil recovery for Indian fields is the difficult terrain as well as the high gas-oil ratio and old and improper production techniques.

Corbishley said that consideringthe low price of crude oil in the international market it was necessary for the cost of production to be low. Cost of production of North Sea oil has come down from $22 per barrel in the eighties to the current level of around $12 per barrel. This is expected to go down to $8 per barrel by the year 2002. The cost of productions of new well should be lower which can be possible by using latest technologies in drilling like string hole drilling. This technology is not only cheaper as it uses lesser steel but also faster and less cumbersome as the strings have no joints. Further water injection technology can be incorporated which results in production increasing by 40 per cent. At the current levels an increase in production by one per cent will result in savings of $10 billion and extra oil production equivalent to that of 1.5 year. Emphasising the point to increase oil production BC Bora, CMD, ONGC said that the focus of India's exploration effort includes four important element. First is the seismicprogramme to study the configuration of some of the vast, lesser known sedimentary basins in the country to determine the prospects of unexplored areas. Second exploration in frontiers which were not earlier explored due to technological shortfall. Third is thrust on deep water exploration beyond 200 meters isobath and finally through cooperation with other countries to explore for oil reserves.