DGH backs ONGC in Tapti decommissioning row

Vol 18, PW 7 (20 Nov 14) Exploration & Production

The DGH has reversed its earlier stance and now supports ONGC in its dispute with PMT partners BG and Reliance over who should pay for site restoration after abandoning the Tapti field.

A DGH source confirms it wrote to the PMT consortium last week asking it to deposit $335m: the cost estimated by UK-based Project Control Partnership (PCP) for restoration. “Under the PSC the consortium must pay for site restoration,” he says.

PMT partners want to abandon Tapti by July 2015 because output has fallen to less than 880,000 cm/d (31m cf/d). ONGC wants the TCPP and TPP platforms at Tapti for its C-Series and Daman Development Project and for this privilege Reliance and BG want ONGC to bear the entire Tapti abandonment cost.

Until August it looked like the DGH supported them, saying ONGC could use the Tapti facilities while Daman is producing, and pay costs when it abandons Daman. But the DGH changed its mind after a meeting at the oil ministry on September 17, chaired by (then) joint secretary RK Singh and attended by director Nalin Srivastava and DGH, ONGC, Reliance and BG officials.

Under the PSC assets no longer required for petroleum operations must be offered to the government or its nominee free of cost as they have already been cost recovered by the consortium.

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