ONGC’s Milestone: First Oil Production in India

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ONGC Boosting India’s Energy Production

India’s Oil and Natural Gas Corporation (ONGC) achieved a significant milestone by producing the first oil from its KG-DWN-98/2 block in the Bay of Bengal’s Krishna Godavari basin on January 7. The government anticipates that this flagship deepwater project will elevate India’s domestic oil production by 11% and gas production by 15%.

Progress and Targets

With the initiation of oil production from KG-DWN-98/2’s “M” field, ONGC signals the near completion of Phase 2 of the project off the east coast of India. In the final phase, ONGC aims to bring the remaining oil and gas fields online, targeting a production of 45,000 barrels of oil per day (BOPD) and over 10 million cubic meters per day of gas by May or June 2024.

Overcoming Challenges with Innovation

Located 35 km offshore in water depths ranging from 300 to 3200 meters in the Godavari River Delta, the project faced challenges due to the waxy nature of the crude oil. ONGC overcame these obstacles by employing innovative “pipe-in-pipe” technology, a first for India. Despite some international sourcing for specific requirements, most fabrication works were carried out domestically.

Joint Ventures and FPSO Technology

The project involves joint venture partners: Shapoorji Pallonji Oil & Gas (70%) and Malaysia’s Bumi Armada (30%). The Armada Sterling V FPSO, owned by the joint venture, is India’s largest FPSO. It boasts capabilities to withstand super-cyclones, features the largest submersible turret system, and utilizes low-NOx power solutions.

Prime Minister’s Perspective

Indian Prime Minister Narendra Modi sees this achievement as a significant step towards realizing “Atmanirbhar Bharat,” the government’s economic growth initiative translating to self-reliant India. Experts, including Narendra Taneja, Chairman of the Independent Energy Policy Institute, believe that the production off Kakinada in the Krishna Godavari basin could potentially reach 75,000 BOPD in the future.

India’s Growing Energy Demand

India’s energy demand is predicted to grow substantially, with the International Energy Agency (IEA) forecasting a 25% share in global energy demand growth over the next 20 years. By 2030, India is expected to surpass the EU as the world’s third-largest energy consumer.

India’s Oil Imports and Global Suppliers

India currently imports 76% of its crude oil, making it the world’s second-largest net oil importer after China. According to the IEA, Russia has emerged as a significant supplier, providing 40% of India’s oil imports between January and September 2023. Other major contributors include Iraq (20%), Saudi Arabia (15%), other Middle East producers (11%), Africa (5%), and Latin America (4%).

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