ONGC, partners to invest $1 bn for exploration

Domestic exploration major Oil and Natural Gas Corporation (ONGC) and its partners would together invest over $1 billion as exploration expe...

Domestic exploration major Oil and Natural Gas Corporation (ONGC) and its partners would together invest over $1 billion as exploration expenses for 14 oil and gas blocks it has won in the fourth round of bidding under the new exploration licensing policy (Nelp).

Out of the the $1.003 billion investment committed, ONGC’s share would be $890 million, chairman and managing director, ONGC, Subir Raha told reporters after signing license agreements for exploring 14 oil and gas blocks on Friday. ONGC and its partners — Oil India Ltd, Bharat Petroleum Corp and Hindustan Petroleum Corp — have committed a minimum investment of $412 million in the mandatory first phase of exploration in these blocks.

The second and third phase of exploration depends on results of first phase and ONGC may decide to abandon any block and not make further investment if commercial quantities of oil and gas are not discovered. Out of the $412 million commitment, ONGC’s share would be $360 million. “With the 14 blocks in Nelp-IV, ONGC has 51 out of the 91 blocks awarded under the four rounds of bidding in last four years,” Raha said.

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In Nelp-IV, ONGC on its own won half of the ten deep sea oil and gas offer. It bagged two deep sea blocks in consortium with HPCL and two more in consortium with OIL and BPCL. ONGC bagged Assam onland block with OIL, Gujarat block with Cairn and a block in TN with BPCL. With OIL as lead partner, ONGC got one block each in Assam and Rajasthan.

The government has awarded 20 oil and gas blocks for exploration and production, 14 of which went to ONGC and partners. The Centre also signed licence agreements with ONGC for five deep sea oil and gas blocks on the east and west coasts and with Reliance Industries for one deep water block in the Bay of Bengal. ONGC and HPCL combine signed agreements for two blocks in Kerala-Konkan basin.

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