The Oil and Natural Gas Corporation Limited (ONGC) is set to finalise the location for drilling of wells in the Andamans by the end of May, Sushma Rawat, Director (Exploration) told Moneycontrol.
“We have analysed the (survey) data and will be coming up with a proposal for location—pinpoint where to drill. We have a three-well commitment for deep water (in the Andamans) and the locations will be firmed up by May-end,” Rawat said.
The state-run oil explorer has two blocks in the Andaman basins which the company won in the sixth open acreage licensing programme (OALP) round. ONGC has completed the survey of the blocks it was awarded in the Andamans.
The basins in the Andaman are expected to be sitting on large reserves of hydrocarbons. Therefore, the Indian government is keen to push oil and gas exploration activities in the Andaman basin as part of its strategy to boost domestic production for energy security.
Rawat added that ONGC plans to initially drill three wells in the area and expects drilling to commence by the end of 2024. The company has begun hiring floaters and rigs for exploration activities as well, she said.
Rawat said the company is expecting significant output from the region. “We are expecting good returns for production. I cannot put a number to it currently but it might be 4-5 TCF (trillion cubic feet) once we go aggressive about it,” she said.
Exploration activities in the Andamans have been long delayed, awaiting clearances from DRDO, space agencies, the Coast Guard, and other agencies. However, the government opened up acreages in the Andamans – once considered a no-go area – with the objective of increasing domestic oil and gas production.
Global players’ collaboration
Since the blocks in the Andamans are in ultra-deep water, ONGC is looking at partnerships with foreign players such as TotalEnergies, Chevron and ExxonMobil for high-end technologies.
Rawat said talks are ongoing with global players for partnering up for exploration activities, but the company intends to go ahead with exploration activities in the blocks for now. She added that international oil companies are awaiting the Oilfields (Regulation and Development) Act (or ORD Act) to be passed.
“Most of the players have been quite positive about the Eastern offshore of India including the Andamans. Global players are, however, waiting for the ORD Act to be amended,” said Director-Exploration of ONGC.
Rawat added that the Ministry of Petroleum and Natural Gas (MoPNG) has had discussions with all the operators and will then go ahead with amendments. Regarding this, international players are directly in talks with the Oil Ministry, she said.
“We cannot slacken our pace. Whether they (global players) are coming or not, our country requires oil and gas. Mahanadi has been a success. And then we are going on with Kaveri; we had joint studies done with Exxon, but we are not going to wait because the acreages also have their timeline. So, we're going ahead with the Kaveri and then into the Andamans. We have offered that they can come and join us anytime they want, whether it is in the exploration phase or in the development phase or in the production phase. ONGC has kept that open.”
ONGC commenced oil production from its Krishna Godavari basin in early January which is expected to enhance the company's total oil production by 11 percent. ONGC also expects gas production to begin by mid-year from the block.
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