Govt plans to give 60% stake of ONGC, Oil India to private companies
oil ministry has chosen 11 functional oil and gas fields of the state-run firm ONGC and OIL for handing over to private firms to raise output.
The fields together have combined reserves of 791 million tonnes of oil and 333.46 billion cubic meters of gas. ONGC will lose control over 11 fields, including Kalol, Ankleshwar, Gandhar - all prized projects producing oil and gas - and the Santhal oilfield. OIL will lose Moran, Greater Dikom, Greater Chandmari and Eastern Satellite, all of which produce oil.
The policy being made offers 60% stake with operational control in these fields for 20 years, or the field’s remaining life. The mining lease will also be transferred to the private company chosen through bidding. Companies offering the highest investment within 10 years of the award and revenue share will win the fields.
These fields called ‘nomination fields’,, were parcels of land given to ONGC for exploration at a time when India was not known for prospectivity, or nearly a decade before the auctions started. The fields account for 69% of domestic crude and 75% of gas production.
Several former ONGC directors told the press that new technology can be inducted without divesting the fields and ONGC was among a few in the world which “continues to maintain, revive and raise production from fields of such vintage as Mumbai High or Bassein – or older – using technology and home-grown innovations.”