The Asian Age
ONGC blames DGH
Says refusal to clear JV delayed gas output from KG
New Delhi, Sept. 1: As the oil ministry looks into reasons for delay in ONGC’s KG basin gas development, the stateowned firm says it lost three years because the ministry and DGH refused to approve its partnership with Norway’s Statoil and Petrobras of Brazil for the block.
Oil and Natural Gas Corp ( ONGC) had in 2007 farmed out 15 per cent stake in the KGDWN- 98/ 2 block, which sits next to Reliance Industries’ KG- D6 block, to Brazil’s state- controlled oil firm Petroleo Brasileiro SA or Petrobras. Another 10 per cent interest was given to Norway’s Norsk Hydro ( now Statoil Hydro).
The two firm, who are among the biggest deep sea developers in the world, were to bring in technology and expertise to development of gas discoveries in KGDWN- 98/ 2 or KG- D5 block of ONGC.
However, the ministry and its technical arm, directorate general of hydrocarbons ( DGH) did not approve the equity participation of the foreign companies, leading to inordinate delays in clearing of drilling programme, ONGC sources said.
Frustrated at delays, the two firms finally walked out of the block in 2010. KG- D5 block was originally planned to start producing gas from 2014 with a peak of about 20- 25 mscm/ day. Now, the block will not produce before 2018.
After the pullout of Petrobras, Statoil and, the oil and natural gas corporation ( ONGC), which does not have the technology to produce gas from deep sea in geologically hostile the Krishna Goda- vari basin, they tried to rope in other foreign energy majors but its attempts were futile as it could not get approvals, sources said.