ONGC to invest further in oil exploration and production

13 January 2009

The directrate general of hydrocabons has approved  ONGC appraisal plan for the gas discoveries in deep-sea block KG-DWN-98/2.

ONGC will dig six appraisal wells to assess potential of the discoveries. The company will invest $5.3 billion in developing gas finds in two of its eastern offshore Krishna Godavari basin blocks to produce 25 million standard cubic meters per day of gas. This investment will be done over the next five years by 2013.
 
An appraisal programme helps the exploration companies in establishing the commerciality of the discovery. After establishing the commerciality comes the development of the field. Exploration companies after finding hydrocarbons submit an appraisal plan to the management committee of the block. Subsequent to the nod, the companies go in for an appraisal programme.

The block is adjacent to Reliance Industries' KG-DWN-98/3 or D6 block. ONGC plans to tie up 10 discoveries in KG-DWN-98/2 with the G-29, GS-4 and Vashistha gas finds in a shallow water block KG-OS-DW4 in the same basin.

Besides natural gas, ONGC also plans to produce 8,000 barrels of oil per day from the fields. The reserve estimates and production plan in ONGC's appraisal programme, however, excludes ultra-deepwater UD-1 discovery in KG-DWN-98/2 block.

The UD-1 discovery alone has been certified by DGH to hold just over 2 Trillion cubic feet of inplace gas reserves.

Ten discoveries in KG-DWN-98/2 (excluding UD-1) and three in adjacent block together hold 6.37 Tcf of inplace reserves.