Coal News We love to talk!
While ONGC and Reliance Industries (RIL) have battled over the latter allegedly taking away gas worth about Rs 8,500 crore from the state-run explorer’s portion of the Krishna-Godavari (KG) Basin, an over-three-year-old arrangement has existed between the PSU and Cairn India under which the Vedanta Group firm processes not just its own but also the PSU’s share of the Cambay Basin gas.
Cairn India, which has spare facilities in the Cambay Basin, undertakes processing of ONGC gas for a fee. The arrangement between ONGC and Cairn helps in optimising the Cambay block’s infrastructure and is a win-win arrangement for the firms, analysts said.
Sources told FE that nearly 1.5 million standard cubic feet per day of gas from ONGC’s North Tapti fields in the Cambay Basin has been flowing through Cairn India’s Suvali terminal since June 2, 2012. “Till now, six wells of ONGC have been connected to Cairn’s processing facility and over 40 bcf (billion cubic feet) of North Tapti gas has been processed by the private company,” a senior official in the know of the development told FE.
The story is as follows. In 2012, Cairn India entered into a unique arrangement, not common in India, with ONGC, to process gas from the PSU’s North Tapti asset through its existing CB-OS/2 asset in the Cambay Basin in Gujarat. ONGC’s North Tapti asset is situated 20 km off Cairn India’s Cambay (CB-OS/2) Lakshmi A platform. ONGC estimated the gas field to have 2P (proven and probable) reserves of 145 bcf gas at the time of signing the arrangement.
Given its proximity to Cairn’s Lakshmi A platform and availability of surplus capacity there, ONGC realised that utilising the private explorer’s facilities was the most suitable option for extracting the gas from the North Tapti fields.
Cairn India not only agreed to connect ONGC’s wells to its platform but also to process the gas at its Suvali processing platform. “To optimise the available infrastructure, Cairn India’s Lakshmi A platform has been connected to ONGC’s North Tapti platform through an 18-inch, 20-km undersea pipeline,” said another official.
Cairn India’s Cambay assets — including THE Laxmi and Gauri fields — now produce mainly oil (60%), which allows it to extend the extra gas processing facility to ONGC.
As reported by FE earlier, the US-based international consultant DeGolyer and MacNaughton (D&M) recently said in a draft report that RIL extracted at least 9 billion cubic metres of gas from ONGC’s block in the KG Basin block, which is contiguous with RIL’s KG-D6 block. Reservoir connectivity, meaning when any oil and gas block is continuous underground, is not a new phenomenon in the hydrocarbon industry, according to analysts. There are several such cases in the oil-rich Gulf countries. According to industry watchers, an exploration company was producing oil from an Abu Dhabi offshore field known as Sassan, whose reservoir was spread across the international boundary between Abu Dhabi and Iran.
In another such case, Qatar is reportedly developing the North Field that is expected to be connected to South Pars of Iran, across the border. If the reservoir is connected, as believed, North Field is reducing Iran’s hydrocarbon recovery. However, there is no unitisation agreement between the two countries.
- NITI Aayog Invites comments from all Stakeholders on Zero Emission Mobility, latest by 31st January 2018 Read more
- IEA's view out of touch, thermal coal demand won't rise beyond 10%: Report Read more
- Gas migration case: RIL initiates arbitration against govt Read more
- Coal prices to stay firm on higher power demand Read more
- With nuclear deal in sight, Iran drives harder bargain in Indian trade talks Read more
- Gail to stop LNG imports at Dabhol till October Read more
- ONGC gets govt nod to sell stake in IOC, GAIL to fund HPCL buy Read more
- SC nod to Kudankulam project spurs nuke outreach to locals Read more
- Government appoints ministerial panel as RIL, Essar CBM price differ Read more
- ONGC Videsh eyes oil & gas blocks in Colombia Read more