Debate on oil production from GS-15 and GS-23

Vol 4, PW 11 (05 Jul 00) Exploration & Production
     

Officials from ONGC's Southern Regional Business Centre (SRBC) are locked in argument with the corporation's finance department over the merits of producing crude oil from the twin offshore locations of GS-15 and GS-23.

Original ONGC development plans - written during the all-time low oil price last year - single out GS-15 and GS-23 as gas producers. But today, with prices at an all-time high, production managers at SRBC ("hungry to improve career prospects") have begun lobbying the finance division at ONGC headquarters in Delhi to release extra money to invest in crude oil production at the twin locations.

A source tells Petrowatch GS-15 and GS-23 can produce a combined 3,600 barrels a day. Cost of investment Rs97cr ($22m).

But for now ONGC's finance division is reported to be hesitating and has cast doubt on the ability of SRBC, "to get an 18% return on investment." Finance officials at ONGC also argue that SRBC has not yet been able to establish the quantum of recoverable crude oil reserves at GS-15 and GS-23. News of the ONGC debate aboutproducing more oil from the region will come as a surprise to those who see its future as a producer of gas - not oil.

On 28th June, junior oil minister Etienne Ponnuswamy, speaking in Rajahmundry, HQ of ONGC's Krishna Godavari Project, again confirmed what has long been known: gas production from SRBC will double from an average 4m cubic metres a day (cm/d) to an average 8m cm/d by next year.

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