ONGC fields to be pushed into more production enhancement contracts

Following the sustained and steady fall in production from both onshore and offshore fields of oil major ONGC since 2006-07, the Directorate General of Hydrocarbons (DGH) plans to push the company into more production enhancement contracts (PEC).

“If for any field, it cannot increase yield, it should relinquish the acreage (without waiting for too long),” said a government official requesting not to be named. The official added that a large number of fields will be put under PEC and it is being decided which ones should taken up in the first round.

The DGH had been asked by the ministry of petroleum and natural gas to regularly monitor the national oil companies.

Data show ONGC’s production from major onshore fields have fallen from 4.84 million tonnes (MT) in 2006-07 to 2.79 MT by 2015-16, and that for major offshore from 15.43 MT to 11.77 MT during the same period. Interestingly, the production figures have shown a continuous fall.

However, according to the government official, the fields are not declining resource-wise but extraction has been poor.

 

Production from major fields of Oil India, which only operates onshore fields, has also been falling — from 1.139 MT in 2006-07 to 0.553 MT by 2015-16, although some years witnessed minor correction.

There are various dimensions to PEC. Some could be as simple as bettering some surface facilities such as separators, pipelines and tanks as often these get choked, corroded or starts leaking. Usually improving these surface facilities result in 3-5% improvement in production.

Indian Express on March 7 reported that the petroleum ministry has ordered a detailed review of the board of ONGC and functional heads as project delays are a norm and output has not increased. The DGH and the exploration arm of the ministry will be looking at some of the projects and submit a review.

The government is of the view that ONGC’s productivity is low and, according to the official, the number of wells it drills per annum is not adequate.

Falling production of the national oil companies does not augur well for the country which is striving to achieve energy security and plans to reduce its imports drastically by 2030. To this end, the NDA government has also announced that some of the oil companies will be merged to create integrated companies which will provide end-to-end services and have the financial muscles to compete with international firms such as Shell and BP.

“The DGH is figuring out how production enhancement can happen and there would be a few strategies. It (DGH) has the time series data to work with,” the official added.

ONGC, 9 Other Sensex Firms Add Rs 28,382 Crore to Market Value

ONGC, 9 Other Sensex Firms Add Rs 28,382 Crore to Market ValueNew Delhi: The combined market valuation of top ten Sensex companies rose by Rs 28,382.58 crore during the week from December 21 to December 24, with (Oil & Natural Gas Corporation (ONGC) emerging as the biggest gainer.

The market capitalisation (M-Cap) of ONGC surged by Rs 9,154.37 crore – the most among the top 10 firms – to Rs 2,00,155.69 crore.

The M-cap of ITC jumped by Rs 4,779.31 crore to Rs 2,59,608.76 crore, while that of CIL rose by Rs 3,695.07 crore to Rs 2,03,639.59 crore.

Tata Consultancy Services (TCS) saw an increase of Rs 3,330.02 crore in its market capitalisation during the week, taking its M-Cap to Rs 4,79,474.08 crore.

The valuation of Reliance Industries Ltd (RIL) soared by Rs 2,866.7 crore to Rs 3,24,212.65 crore while that of Infosys jumped by Rs 2,273.97 crore to Rs 2,51,710.68 crore.

HUL’s market cap jumped by Rs 898.01 crore to Rs 1,86,796.15 crore.

The market value of HDFC rose by Rs 805.02 crore to Rs 1,94,143.24 crore while that of HDFC Bank was up Rs 315.38 crore at Rs 2,70,982.09 crore.

The valuation of Sun Pharma went up by Rs 264.73 crore to Rs 1,90,494.92 crore.

In terms of ranking, TCS was at the top, followed by RIL, HDFC Bank, ITC, Infosys, CIL, ONGC, HDFC, Sun Pharma and HUL.

The Sensex rose by 319.49 points to settle at 25,838.71 for the holiday-shortened week.