ONGC to fund acquisitions with borrowings of $10 billion

India's leading oil and gas exploration company, the state-owned Oil & Natural Gas Corp (ONGC), has said it may borrow up to $10 billion over the next decade to purchase overseas assets to meet future domestic demand.

Indian oil exploration companies have been forced to look abroad even as output in local fields has been declining and exploration and exploitation of domestic acreage, for reasons unknown, has been lacklustre.

ONGC made just 15 new domestic discoveries and acquired only a single oil asset abroad in fiscal 2009-10, as compared to 2008-09 when it announced 28 new domestic discoveries.

According to ONGC chairman, RS Sharma, the company was trying to bring new discoveries to production at the earliest and was focusing on quicker commercial exploitation of marginal fields.

He said the company would bring the G-1 field on the east coast, eight B and C series fields on the west coast on stream over the next two years. Cumulatively, these fields will produce about 42 million tonnes of oil and oil equivalent gas over a span of 15 years.

Crude production in the first nine months of the present fiscal has dipped to 19.89 million metric tonnes (mmt) as compared to 20.57 mmt in the year-ago period. Consequently, ONGC is trying to boost dipping production in ageing fields by implementing high-tech improved oil recovery (IOR) and enhanced oil recovery (EOR) schemes.