ONGC to invest $5 billion in KG fields
The state-run firm on Wednesday submitted to the regulator Director General of Hydrocarbons an appraisal programme.business Updated: Oct 18, 2007 13:28 IST
Oil and Natural Gas Corp (ONGC) plans to invest over $5 billion to produce 25 million standard cubic meters per day (mmscmd) of gas from its eastern offshore Krishna Godavari fields by 2013.
The state-run firm on Wednesday submitted to the regulator Director General of Hydrocarbons an appraisal programme of the discoveries it had made in KG offshore basin, putting the in-place reserves at 6.37 Trillion cubic feet (Tcf), industry sources said.
Besides natural gas, ONGC also plans to produce 8,000 barrels of oil per day from the fields. The reserve estimates and production plan in ONGC's appraisal programme, however, do not include its ultra-deepwater UD-1 discovery in KG-DWN-98/2 block adjacent to Reliance Industries' prolific gas discovery block KG-D6.
ONGC estimates another 2-14 Tcf of reserves in the UD-1 discovery, sources said, adding half-a-dozen other finds in the same KG-DWN-98/2 block have been clubbed with other discoveries in the region like G-29, GS-4 and Vashistha.
The production planned is better than previously announced plans of 12-15 mmscmd. Sources said the company's appraisal plan outlines integrated development of the discoveries in shallow to deepwater (northern) part of the KG-DWN-98/2 block along with other fields in adjoining nomination acreages.
While ONGC has 90 per cent stake in the KG-DWN-98/3 block, it has 100 per cent stake in the adjoining acreage which it got from the government on nomination basis.
Cairn India has the remaining 10 per cent in KG-DWN-98/3. Norsk Hydro of Norway and Petrobras of Brazil are to take 15 to 30 per cent stake in the block.
ONGC, which currently produces 22.10 billion cubic meters of gas a year, has taken a cluster development approach for developing the KG offshore finds, sources said.
In December 2006, ONGC had made the nation's first ultra-deepwater discovery. The ultra-deepwater well UD-1 in KG-DWN-98/2 has proved presence of gas in significant quantities for which the volume of reserves and commercial viability are likely to be established in due course, they said.
The block sits next to Reliance Industries' prolific KG-D6 block. ONGC and Cairn India has made seven gas discoveries in the block till date, the largest being the one discovered in December holding in-place reserve of 2.08 Tcf. ONGC has made three gas discoveries in adjoining blocks and is planning an integrated development of all the finds.
It has roped in Norsk Hydro of Norway and Petrobras of Brazil as equity partners in the block for the development of the deep-sea find.
Reliance Industries is developing two deep-sea gas fields in KG-DWN-98/3 (also known as KG-D6) in the same basin, off east coast, from which it aims to produce up to 80 mmscmd beginning July next year.
Sources said an integrated development plan would be submitted to the regulator by December or early 2009.
First Published: Oct 18, 2007 13:21 IST