ANY LUCK IN THE DEEP WATERS?

Vol 3, PW 8 (12 May 99) Exploration & Production
     

Hardly.

Last year ONGC was confident that imminent success in the deep waters of east India would help bolster its diminishing reserves replacement ratio. Ambitious plans were laid out for a series of exploration wells and at least six foreign companies were invited for talks on a joint venture.

So far, neither exercise has borne fruit. ONGC has drilled two dry holes, one in the Cauvery and one in the Krishna Godavari.

As we speak, drilling is underway at a third deepwater site in the Krishna Godavari. A source at ONGC tells this report the well has reached a depth of 780 metres below the seabed and that a second 20 inch casing has been put in.

A Blow Out Preventer (BOP) was lowered last weekend. It is difficult to say if ONGC would have fared better had it been allowed to team up with say, Mobil, its preferred choice.

Bikash Bora, Chairman, ONGC clearly thinks so. Not without a hint of frustration, Bora told a Delhi press conference last week ONGC will abandon its solo deepwater exercise unless the oil ministry grants it similar terms available to bidders under the New Exploration Licensing Policy (NELP).

"We submitted this proposal in September last year", said Bora, "We have yet to hear from the government". In this regard, ONGC may have to wait a bit longer.

A source in the oil ministry tells this report it is sticking to its position of not granting NELP terms for exploration acreage granted to ONGC on a nomination basis. He adds that the ministry - in an ideal world - is keen to show favour to ONGC, but fears that NELP terms for nomination acreage would provoke criticism.

"We are still undecided" he adds.