ONGC to drill in ~65,000 cr for KG-basin
State-run Oil and Natural Gas Corporation (ONGC) plans to invest up to $10 billion (~65,000 crore) in its three clusters in the Krishna-Godavari basin (KG-basin).
The company has divided the deepwater block, KG-DWN-98/2, into clusters I, II and III. “For the three, we plan an overall investment of $9-10 billion. Cluster III will be the deepest in India, extending to about 2,600 metres,” Tapas Kumar Sengupta, director (offshore) of ONGC, told this newspaper.
The company has invited a formal expression of interest from international consultants and service providers for developing Cluster III. “We have already submitted a declaration of commerciality with the Directorate General of Hydrocarbons for Cluster III development. Currently, there are only 10 (petro) fields in the world at such depth,” he added.
About 19 million standard cubic metres a day (mscmd) of gas is expected in this area, where ONGC is planning to drill at least nine wells. The company is to come up with a field development plan by the end of the year. This area will see an investment of nearly $3 billion.
Cluster II will see investment of about $5.1 billion. This area is likely to produce its first gas by June 2019 and oil by March 2020.
The company is expecting peak output of 17 mscmd of gas and 77,305 barrels of oil a day from here. Most of the tenders for this area should be issued by the middle of this year. The company will connect the recently acquired assets of Gujarat State Petroleum Corporation to this cluster. The ONGC board had cleared the $1.2-billion acquisition on February 24.
Cluster II is divided into two parts. Cluster IIA has estimated in-place reserves of 94.26 million tonnes of crude oil and 21.75 billion cubic metres (bcm) of gas. Cluster IIB has an estimated 51.98 bcm of gas.
ONGC expects investment of at least $1 billion for Cluster I.
However, the current domestic price for natural gas is not viable enough, say some observers, for many blocks. With effect from April 1, the government has cut the price to $2.48 per million British thermal units, effective for six months.