ONGC and Indian Oil partner up to establish LNG plant near Hatta Gas Field - Hindustan Times

ONGC and Indian Oil partner up to establish LNG plant near Hatta Gas Field

Jun 22, 2024 05:04 PM IST

ONGC said that the discovery at Hatta represents the results of five decades of exploration efforts.

ONGC and Indian Oil will together, establish a small-scale Liquefied Natural Gas (LNG) plant near the Hatta Gas Field in the Vindhyan Basin.


The two PSU oil giants signed a memorandum of understanding (MoU) on 17 June 2024 for the project, according to ONGC’s press statement.

The establishment of the Hatta LNG plant will upgrade the Vindhyan Basin from a Category II to a Category I Basin, the statement read.

India's sedimentary basins, covering a total area of 3.4 million square kilometres, are divided into three categories:

  • Category I: The ones which have hydrocarbon reserves and are already producing hydrocarbon products.
  • Category II: The ones that have resources, but commercial production is pending.
  • Category III: The ones with prospective resources awaiting discovery.

The plant will utilize cutting-edge technology to produce LNG, a cleaner alternative to traditional fossil fuels, significantly reducing carbon emissions and aligning with India's climate change mitigation goals, according to the statement.

Also Read | OPEC still sees strengthening oil demand in emerging markets, plans supply hike

The background

ONGC said that the discovery at Hatta represents the results of five decades of exploration efforts and that it has already submitted its Field Development Plan (FDP) to the Directorate General of Hydrocarbons (DGH) to monetize its assets in the Hatta area.

The company in March 2022, decided to commercialise the Hatta-3 gas discovery in the Son Valley area of Madhya Pradesh, after the exploratory well produced 62,044 cubic meters of gas per day, opening up India’s ninth producing basin and eighth by the company, according to a Times of India report.

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Foreign deals

This comes against the backdrop of the Indian government being in talks with Norwegian energy giant Equinor to secure its participation in India’s strategic petroleum reserves (SPR) as well as for long-term deals for supply of liquified natural gas (LNG) from Equinor’s extensive portfolio in the US and Qatar, according to a Mint report.

All of this are efforts to enhance the energy security of India, the world’s third largest energy consumer, according to the report.

Also Read | ONGC seeks foreign partners for Mumbai High oilfield as output falls

Why is energy security a concern?

The Indian government's negotiations with Equinor come amid continued production cuts by the Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, which have put global supply chains under pressure, the report read.

ONGC had also put forth a tender on June 1 to engage an international firm to enhance oil production from its flagship Mumbai High oilfield, claiming that the oil field was facing an “alarming state of decline”, according to documents seen by HT.

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