New Delhi: The Ministry of Petroleum has told the largest oil and gas producer, ONGC, in India to sell its share in the production of oil fields such as Ratna R series to private enterprises, to get foreign partners in gas fields from the KG basin, existing earn infrastructure, and pick up drilling and other services. in a separate firm to increase production.
Amar Nath, additional secretary (exploration) in the Ministry of Petroleum and Natural Gas, on April 1 gave the chairman and managing director of the Oil and Natural Gas Corporation (ONGC), Subhash Kumar, a seven-point action plan, ‘ONGC Way Forward ‘which would help the firm increase oil and gas production by one third by 2023-24.
The action plan, which is being reviewed by PTI, calls on ONGC to consider selling a stake in driving countries such as Panna-Mukta and Ratna and R-series in western foreign and rural fields such as Gandhar to Gujarat to private enterprises while they sell / privatize ‘marginal fields that do not perform.
It wanted ONGC to bring in global players in the gas-rich block KG-DWN-98/2, where production would rise sharply by next year, and the Ashokenagar block recently produced in West Bengal. For this purpose is also the Deendayal block in the KG basin that the firm bought a few years ago from the Gujarat government firm GSPC. The Ministry also wants the company to investigate the creation of separate entities for drilling, drilling services, reporting, work service and data processing entities.
This is the oil ministry’s third attempt to persuade ONGC to privatize its oil and gas fields under the Modi government. In October 2017, the Directorate-General’s Hydrocarbons, the technical arm of the Ministry, identified 15 producing fields with a combined reserve of 791.2 million tonnes of crude oil and 333.46 billion cubic meters of gas, which were handed over to private companies. in the hope that they would improve the baseline estimate and its extraction.
A year later, as many as 149 small and marginal fields of ONGC were identified for private and foreign companies on the grounds that the state-owned enterprise should focus only on large ones. The first plan could not go through due to the strong opposition of ONGC, sources aware of it said.
The second plan went to the Cabinet, which on 19 February 2019 decided to present 64 marginal fields of ONGC. But the tender received a final response, saying that ONGC may retain 49 countries on condition that their performance is closely monitored for three years. According to the Ministry of April 1, 2021, two years have passed since the cabinet decision and that the non-performing fields need to be identified for sale and privatization.
It offers market-friendly bidding conditions such as lower royalty rates and complete marketing and price freedom. For medium-sized producing fields, the action plan wanted ONGC to identify mature fields such as Panna-Mukta, Ratna and R-series in the western overseas and Gandhar in Gujarat, as well as fields such as Daman in the western foreign overseas with emerging development plans. for the game sale.
It also wants the ONGC to consider developing new business models for monetizing disabled assets / discoveries such as design, financing, building and operating, as well as annuity and securitization based models for development. Fields such as GK-28/42 and all unmonitored discoveries, individually or as a bouquet, were identified for the purpose, the document showed.
The note states that the Ministry has set the local production target of 40 million tonnes of crude oil and 50 billion cubic meters (bcm) of natural gas by 2023-24 to reduce the dependence on imports of crude oil and gas. The bulk of the planned domestic production for 2023-24 is expected to come from ONGC, which should contribute 70% of domestic production (28 million tonnes of oil and 35 bcm of gas by 2023-24).
It is said that the share of the ONGC contribution in the oil and gas consumption in the country is constantly decreasing as its production stagnates or decreases for a long time. As a result, dependence on imports is increasing.
ONGC produced 20.2 million tonnes of crude oil in the financial year ended 31 March (2020-21), down from 20.6 million tonnes in the previous year and 21.1 million tonnes in 2018-19. It produced 21.87 bcm of gas in 2020-21, down from 23.74 bcm in the previous year and 24.67 bcm in 2018-19.
Source: Telangana Today