State-owned Oil and Natural Gas Corp’s (ONGC’s) 64 domestic fields have total reserves of 1.06 billion tonnes (Bt) of oil and oil-equivalent natural gas, according to independent audits.
In preparation of its share sale next month, ONGC had engaged Gaffney Cline and Associates (GCA) and DeGolyer & MacNaughton (D&M) to audit its 64 domestic fields. While GCA prepared audited estimates for Mumbai High, D&M prepared estimates for 63 other fields.
According to audit estimates, the 64 fields have a 3P (total oil reserve) of 558.4 million tonnes and oil-equivalent gas worth 503.1 million tonnes. The estimates are higher than ONGC’s self-assessment of 966.2 million tonnes of oil and oil-equivalent gas reserves.
A company official said oil reserves were primarily a measure of geological risk — the probability of oil existing and being producible under current economic conditions using current technology. The three categories of reserves generally used are: proven reserves (reasonably certain to be producible), probable reserves (50 per cent chance of these being produced) and possible reserves(having 10 per cent certainty of being produced).
The government plans to sell five per cent of its stake in ONGC through a follow-on public offer next month to raise Rs 12,000-13,000 crore.
For the 12 foreign properties held by ONGC Videsh, the firm’s overseas subsidiary, independent review put 1P, 2P and 3P reserves at 119.98, 288.3 and 639.7 million tonnes of oil and oil equivalent gas. GCA estimated 1P, 2P and 3P oil reserves at Mumbai High, off the west coast, at 134.2 million tonnes, 239.7 million tonnes and 269.5 million tonnes of oil, respectively.
These were higher than ONGC’s estimate of 125 million tonnes of 1P and 190 million tonnes of 3P reserves, the report said. As far as natural gas is concerned, GCA estimated 1P reserves of 42.5 million tonnes oil-equivalent at Mumbai High and 3P reserves of 80.4 million tonnes. These compared to ONGC’s estimate of 48.7 million tonnes of 1P and 73.9 million tons of oil-equivalent 3P reserves.
For the 63 fields, D&M estimated 1P reserve of 194.6 million tonnes of oil and 241.1 million tonnes of oil-equivalent gas. It put 2P and 3P reserves at 232.8 million and 288.9 million tonnes of oil, respectively. Gas equivalent reserves were put at 241.1, 347.3 and 422.7 million tonnes of oil-equivalent gas.
“The principal difference between ONGC’s and GCA’s estimates is that GCA has considered aggressive water injection in the field, which would enhance life of the field and higher ultimate recovery,” the reserve report said.
