Oil & Natural Gas Corporation Ltd (ONGC) is all set to acquire five onshore blocks spreading over 16,500 square kilometers in West Bengal for Rs 10,000 crore next month.
The Directorate General of Hydrocarbons(DGH), the upstream regulator under the Union ministry of petroleum and natural gas, would sign the production sharing contracts (PSC) with state-owned oil explorer for six blocks including one offshore block in the Andaman and Nicobar Islands by September 30. ONGC had bid for these blocks under the New Exploration Licensing Policy (NELP) and reportedly was the sole bidder in four of these blocks.
ONGC will apply for a petroleum exploration licence from the state government for onshore blocks, and could start exploration and production (E&P) activities only after getting the government’s nod.
According to industry experts, ONGC would require an area of around 13,000 square metres (110 m X 110m) for one drill site for digging up to three wells. It would zero in on the drill sites after detailed two and three dimensional cyclic surveys. It, however, declined to give out an estimate of the crude reserves in these blocks. The company has only one E&P block at Contai in West Bengal. In another significant development, ONGC chairman and managing director, R S Sharma on Saturday said that it was open to tie up with a local partner in Russia as the state-owned oil explorer was moving ahead to acquire UK based Imperial Energy that operates primarily in Russia’s Siberian region of Tomsk.
ONGC Videsh, a wholly-owned subsidiary of ONGC and its overseas investment arm, has submitted a negotiated bid for $2.6 billion or 1,250 pence a share to acquire Imperial Energy. He did not want to divulge further details.
ONGC had a plan outlay of Rs 2,800 crore for coal bed methane (CBM) during the Eleventh Plan period and had already spent Rs 300 crore on the same. It would start production from 20 odd wells in the Jharia region of Jharkhand, especially concentrated over a six sqkm area in Parvatpura from December this year.
The initial nominal production of 5-10 cubic metre per day (cmpd) would be scaled up phase wise to 50,000 cmpd by November 2009 and eventually to 400,000 cmpd by 2011.
