NEW DELHI, India – Press Trust of India reports that state-owned Oil and Natural Gas Corp. (ONGC) will invest $9 billion in bringing to production by 2017–2018 an array of oil and gas discoveries in Krishna-Godavari basin off the east coast of India.
ONGC has made 11 oil and gas discoveries in block KG-DWN-98/2, which sits next to Reliance Industries Ltd.’s (RIL’s) KG-D6 block and Gujarat State Petroleum Corp.’s Deendayal gas field. The block is divided into a Northern Discovery Area (NDA) and Southern Discovery Area (SDA).
ONGC plans to make that investment in producing from discoveries in the NDA. The company expects to produce 2.5–3 million metric tons (2.8–3.3 million tons) of oil per year, and 9–10 MMcm/d of gas from the NDA, which holds an estimated 92.3 million metric (102 million tons) of oil reserves and 97.6 bcm of in-place gas reserves spread over seven fields.
ONGC bought a 90% interest in block KG-DWN-98/2 from Cairn Energy India in 2005. Cairn still holds 10% in the block. Before selling most of its stake and giving away operatorship of the block, Cairn made four discoveries in the area – Padmavati, Kanakdurga, N-1, and R-1 (Annapurna). ONGC has made six significant discoveries – E-1, A1, U1, W1, D-1, and KT-1 in the NDA, as well as the first ultra-deepwater discovery UD-1 at a record 2,841 m (9,321 ft).
The NDA comprises discoveries such as Padmawati, Kanadurga, D, E, U, and A, while the ultra deepwater UD find lies in the SDA. ONGC said it plans to produce oil and gas from the NDA by using an FPSO unit. The company is also studying the economic and technical feasibilities of using facilities at the neighboring KG-D6 block. While oil can be produced and stored at the offshore FPSO before being shipped to refiners, ONGC is exploring if some volumes could be diverted to RIL’s infrastructure for onward transmission to Kakinada in Andhra Pradesh, from where it can be sold to consumers.
Block KG-DWN-98/2, comprising 7,295 sq km (4,532 sq mi), was originally awarded to Cairn in the first round of auction under the New Exploration Licensing Policy in April 2000. Of this, ONGC holds 3,801 sq km (2,361 sq mi) in the NDA and 3,494 sq km (2,171 sq mi) in the SDA.