HOEC walks away from Kherem
HOEC has walked away from its DSF-1 block AA/ONDSF/KHEREM/2016 in remote Arunachal Pradesh.
On May 17 (2024), HOEC company secretary Josephin Daisy informed the NSE and BSE that the oil ministry had approved the company's request to relinquish the block in a letter dated May 16 (2024), stressing that no costs or liquidated damages (penalties) need to be paid. "This onshore field is located in Arunachal Pradesh, and operations could not commence for want of a PML," writes Daisy.
"The parties to the RSC decided to relinquish the block, which has been accepted." HOEC and its partners Oil India (40%) and Prize Petroleum (20%) applied for the relinquishment on May 15 (2023) after winning the 16.4-sq km block in 2016.
According to the DSF-1 technical booklet, the block holds 2.998m barrels of oil and 0.0169-tcf of gas in place. HOEC later amended these figures in an October 2018 investor presentation to 10.27m barrels of oil and 0.054-tcf of gas in-place.
High hopes were riding on AA/ONDSF/KHEREM/2016 because of its proximity to HOEC's producing Dirok field, which lies just 60-km away. By April 2024, Dirok was producing 676,770 cm/d of gas and 419 b/d of condensate.
In February 2017, former HOEC managing director P Elango said two discovery wells at Kherem could potentially quickly begin producing 200 b/d of oil. In 1994, the former Oil India-operated field saw a discovery at well Kherem-2 drilled to 3837 metres TD, which produced up to 151 b/d.
In November 2018, HOEC confirmed to this report that it had secured forest clearance for drilling at Kherem and was optimistic it would receive the PML by March 2019.