Amid reports that the government plans to offer 60% stake in government-owned companies’ existing oil and gas fields to private players, state-run ONGC on Friday wrote a letter to the Prime Minister opposing any such move.
Amid reports that the government plans to offer 60% stake in government-owned companies’ existing oil and gas fields to private players, state-run ONGC on Friday wrote a letter to the Prime Minister opposing any such move. Upstream regulator Directorate General of Hydrocarbons has reportedly identified 15 hydrocarbon blocks — 11 of ONGC and 4 of Oil India — which it deems are not producing adequate oil and gas. These fields were given to the two national oil explorers during the nomination era. FE has earlier reported that ONGC will defend the government’s move to privatise the fields. The letter, written by Sanjay Goel from the ONGC’s Association of Scientific and Technical Officers, argues that the fields under question are more than 30 years old and the decrease in production is natural and should not be termed as underperforming fields. ONGC has assured to use enhanced oil recovery techniques and also deploy capital in all of its fields to increase production to achieve the government’s target of 10% reduction in oil and gas imports by 2022.
The company also argues that these fields, though given on a nomination basis, have actually been developed by the company as they were nominated areas and the company has made investments to develop the fields. The letter also cites some privately-held fields which are operating well below their targeted production despite being relatively newer fields. The letter said: “Considering the untiring efforts and remarkable contribution of ONGC in evolution of E&P industry in India and in nation building, we earnestly seek your personal intervention to stall the move to handover existing legacy fields of ONGC to private players which will have not only a highly damaging implication for the nation but will also adversely affect the motivation of employees who are committed to serving the national interests.”