Bad news on the domestic oil production front

Vol 3, PW 21 (10 Nov 99) Exploration & Production
     

Chairman Boras determination to overhaul ONGC is hardly surprising given the pressure he is under to increase production.

This will not have lessened with the publication of figures showing oil production in India stagnating at the same level as last year. Figures from the oil ministry reveal that Indias cumulative oil production between April and September this year was 16.406m tonnes - a rise of just 1% on the 16.238m registered in the same period last year.

Equally depressing for ONGC is the startling revelation that while production at ONGC and Oil India fields is stagnating, production from private sector owned oilfields is soaring, and registered a massive 48% rise over the same figure last year. Problem is, production from private sector oilfields amounted to just 2.01m tonnes in the period.

Total production by ONGC was 12.744m tonnes and by Oil India 1.651m tonnes. No doubt, ONGC will try its best to gloss over the poor production figures.

For how long, is another matter. The principal culprits responsible for ONGCs declining production are in areas where at one time or the other it was considering entering into some form of agreement with an overseas multinational: Bombay High (Marathon Oil, Shell), and Enhanced Oil Recovery (EOR) programmes in the Cambay Basin (Petrom of Romania).

Had it done so the decline could conceivable have been much less. At the Bombay High, for example, ONGC registered a steep 3.7% decline over last year, due to the shutdown of several wells in an effort to preserve a damaged reservoir.

Similarly, a 3.7% decline in production from the Cambay basin is blamed on "less than envisaged response from thermal enhanced oil recovery schemes in the heavy oil belt of Mehsana" and "less than envisaged gain from exploratory wells in Ankleshwar". In Assam, ONGC registered its biggest drop, recording 6.7% decline in production over last year.

Here, flooding and "social" problems (a euphemism for terrorism) were the principal reasons.