ONGC may find more oil in Mumbai's D1 block, shares up 3%

Moneycontrol Bureau

Oil and Natural Gas Corp (ONGC) shares are up 2.85 percent to Rs 317.30 on reports that is on the threshold of discovering additional oil reserves in the Mumbai offshore field.

Currently, the company is testing D1 well to ascertain exact quantity of additional oil, states an Economic Times quoting a senior ONGC executive.

D1 is situated about 200 km west of Mumbai in the deep continental shelf at a water depth of 85 to 90 metres. In August last year, ONGC had made a huge oil discovery in the D1 field and is currently producing 16,500 barrel per day (BPD).

Last month, the firm had said that it has made three significant oil and gas discoveries, two in the Krishna Godavari basin and one in Tripura. It also said that it will invest over Rs 4,050 crore to upgrade its western offshore facilities.

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Meanwhile, the upstream firm is also confident of upping oil production to 28.6 million tonne in current financial year as it has embarked on an expansion programme. In FY13, the state-run upstream firm produced 26.12 MT from its reserves.

However, the firm has been missing production targets in previous quarters, but the company's chairman and managing director, Sudhir Vasudeva recently told CNBC-TV18 that he is hopeful of achieving the set target in FY14.