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State-owned petroleum explorer Oil and Natural Gas Corporation (ONGC) is planning to bring on stream its Kutch offshore basin, the country's eighth new basin, over the next 2-3 years, Chairman and Managing Director (CMD) DK Sarraf said on the sidelines of an industry event organized by United Nations Global Compact Network (UN-GCN) India.
“We have made many new discoveries in the Kutch off-shore basin. Most of them have been gas reserves and the estimates look very promising. We are trying to accumulate more mass and discover more reserves so that production from the basin is profitable in spite of the challenging oil and gas prices. We are looking at monetizing this block in the coming two to three years,” Sarraf said.
The Kutch offshore is a shallow water acreage where ONGC has reached appraisal stage. The oil and gas behemoth is aiming to complete appraisal process and move on for development of resources by mid-2017.
The company has reportedly discovered more than one trillion cubic feet (tcf) of natural gas in the Kutch offshore basin and is trying to establish 0.5 tcf of additional natural gas.
Seven out 26 sedimentary basins in India are currently under production. Cauvery basin was the last basin to come on stream in 1985. The new Kutch off-shore basin would provide respite to ONGC at a time when production has been declining from most of its mature and ageing fields, where the company has deployed Enhanced Oil Recovery (EOR) techniques to maintain production.
Commenting on the latest move by the upstream regulator Directorate General of Hydrocarbons (DGH) to seek stakeholder comments on the feasibility of incentivizing Enhanced Oil Recovery, Sarraf told ETEnergyWorld a policy to incentivize EOR is much needed and a positive step for the company.
“We have given our inputs to DGH. Without incentives, EOR will not be economically feasible due to low price scenario in the oil and gas sector. There is a lot of scope to enhance domestic production in the country by deploying EOR techniques. Deploying EOR is capital and time-intensive process. In the past the industry has taken 10 years to successfully commission EOR projects. We are trying to bring it down to five years,” Sarraf said.
He added EOR techniques have been deployed in most of ONGC's blocks and the company is now focusing on cost-effective operations in offshore blocks. According to Petroleum Planning and Analysis Cell (PPAC), ONGC’s crude oil production in the last fiscal declined by 1.5 percent to 18.2 million tonne as compared to 18.5 MT produced in 2015-16.
The company managed to drill 501 wells last fiscal year, crossing the 500 wells mark for the first time in 23 years. ONGC had made 23 new discoveries last financial year, a 35 percent jump over 17 discoveries made in 2015-16.
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