Hardy lobbies hard for PY-3 re-development

Vol 5, PW 6 (09 May 01) Exploration & Production
     

It's been a long wait, but Hardy Exploration, operator of the declining PY-3 oilfield offshore Chennai, has finally been given permission to begin a crucial re-development programme.

According to a source in the Hardy-led consortium, the re-development, which began in the first half of this month, involves "drilling two lateral wells, four workovers and pressure maintenance through water injection." Sitting in depths of 2-300 metres, PY-3 produces on average 4,000 barrels a day (b/d) - down from its high of 12,000 b/d three years ago. Permission didn't come easy.

We learn Hardy lobbied hard for its inclusion on the agenda of an ONGC board meeting in March. A simultaneous meeting between Hardy, oil minister Ram Naik and senior ministry officials ensured it was approved, despite ONGC hostility.

"You can't argue with technical merit," adds a source. "At the end of the day, the scientific argument prevailed." Hardy reckons PY-3 is producing below full potential.

But sustained opposition by 40% stakeholder ONGC to a re-development programme meant it couldn't do anything about it.Under the Production Sharing Contract, ONGC is the only member of the PY-3 consortium that pays cess and royalty.

It resents this, and blocked a re-development programme in protest. Hardy told Naik India's oil production would suffer because of delay.

The company is confident it can double production at PY-3 to 8,000 b/d.

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