ONGC to invest $2 bn in Mumbai offshore for raising oil, gas output

NEW DELHI: India’s top oil and gas producer ONGC will invest over $2 billion in drilling a record 103 wells on its main gas-bearing asset in the Arabia Sea as it pivots a turnaround plan that will add 100 million tonnes to production, a company official said.

Oil and Natural Gas Corporation (ONGC) has three main assets off the west coast - Mumbai High, Heera and Neelam, and Bassein and Satellite, which contributed the bulk of 21.7 million tonnes of oil and 21.68 billion cubic metres of gas it produced in 2021-22.

“We have released a record 103 locations for drilling of wells on the Bassein and Satellite (B&S) assets over the next 2-3 years,” ONGC Director (Offshore) Pankaj Kumar said. The wells will tap smaller and hereto untapped reservoirs and help raise output.

“We estimate that this development drilling will enhance production by over 100 million tonnes of oil and oil equivalent gas over the life of the field,” he said. “The investment involved in drilling and facilities will be over $2 billion.”

ONGC produces two-third of all oil and gas produced in the country and any incremental production would help the country cut its dependence on imports for meeting energy needs. India imports over 85 per cent of the crude oil, which is converted into fuel such as petrol and diesel in refineries, and roughly half of the natural gas that is used to produce electricity, make fertiliser, converted into CNG for running automobiles and piped to household kitchens for cooking. The government has been pressing state-owned firms to step up efforts to raise domestic output to help cut the $115 billion import bill.

ONGC, which reported a gradual decline in output for over a decade primarily because its fields are old and ageing, has now got its act together by working on a comprehensive asset base plan rather than piecemeal field centric approach.