Highs and lows for ONGC over the last five years

Vol 5, PW 23 (16 Jan 02) Exploration & Production
     

At first sight ONGC's crude oil production target for the next five years is ambitious when compared with its actual performance in the last five years.

Its crude production target for 1997-2002 was 144.89m tonnes but actual production (precise figures awaited) is likely to be 10.7% lower at 129.44m tonnes. Why the shortfall Lower production from theNeelam-Heera fields offshore Mumbai, (unexplained) delay in Enhanced Oil Recovery schemes at Balol and Santhal in Gujarat, lack of significant new finds and tribal insurgency in the north-east.

These are "areas of concern" with ONGC's top management. See below for other highlights in the last five years: Successive reviews, mid course exploration programme changes and improved recovery techniques result in accretion to initial in place recoverable reserves from existing fields and small finds from 28.75 and 15.82m tonnes oil equivalent in 1997-98 to 136.43 and 66.66m tonnes oil equivalent in 2000-2001 Results from 31 new finds in the first four years shows about 85m tonnes oil equivalent accretion to initial in place hydrocarbon reserves Gas production potential in Tripura, Krishna Godavari and Cauvery basins rose from 5.5m cm/d at the end of the 8th five year plan to nearly 14m cm/d in the 9th plan.

These basins are now seen as growth areas, but actual production is constrained because oflow demand. Nine deepwater wells were planned in the 9th plan but because ONGC couldn't find a "suitable" deepwater drilling rig, its Sagar Vijay was upgraded to drill in 1,000 metres water depth.

Sagar Vijay completed seven wells (on five prospects) from April 1998 to September 2001. A further one well is scheduled to be drilled by March this year Three deepwater prospects tested in Krishna Godavari deepwater flowed oil and gas while one each in Kerala-Konkan and Cauvery were dry holes ONGC planned to drill 16 wells in onland frontier basins.

Of these two have been completed and a third is now being drilled. What happens to the rest It seems they will pass into history.

Why "Results have not been encouraging. These are in remote, high risk areas and drilling costs work out to be exorbitant.

Special incentives are needed to offset the risks and costs." Coal bed methane exploration in the Jharia coal field has been successful and four wells were tested. But here delay in grant of petroleum exploration licence is holding up further appraisal work.