Exxon Mobil in talks to buy stake in Indian oil, gas fields

Energy supermajor Exxon Mobil Corp is in talks to buy a stake in producing oil and gas fields in India, Oil Minister Dharmendra Pradhan said on Wednesday showcasing efforts to raise domestic output to cut imports.

Exxon Mobil had in October last year signed a memorandum of understanding (MoU) with state-owned Oil and Natural Gas Corporation (ONGC) to offer its expertise and technology for developing resources in offshore blocks.

Speaking at a webinar series on 'The Road To Atmanirbhar Bharat' organised by Swarajya Magazine, he said India is looking to replicate the Texas model of raising domestic oil and gas production by involving small and mid-sized companies in exploration and production.

"Till 2014, the total acreage given for exploration and production (of oil and gas) was about 90,000 square kilometers.

“In two rounds of auction of small discovered fields (DSF) and five rounds of Open Acreage Licensing Policy (OALP), an additional 1.65 lakh sq km of the area has been offered," he said.

The US shale oil and gas revolution was not brought about by big companies.

"Small companies have developed the Texas shale oil and gas sector. We are envisaging a similar scenario in India through progressive policy and involving a lot of small and mid-sized companies," he said.

But large companies would obviously be there, he said adding UK supermajor BP is investing $5 billion bringing to production the next wave of gas discoveries in KG basin block KG-D6.

Also, Shell and Total are present in India.

"Exxon Mobil is in active discussion with some of our companies to participate in some of our producing fields," he said without giving details.

The October 2019 MoU provided for ONGC and ExxonMobil jointly bidding for exploration assets in India.

ONGC is currently developing deepwater oil and gas blocks on the east coast, which at a peak is envisaged to produce more than 15 million standard cubic meters per day (mmscmd) of gas.

Also in October 2019, Exxon signed another memorandum with the country's biggest refiner Indian Oil Corporation (IOC) to explore ways to supply liquefied natural gas to meet India's burgeoning gas demand.

While Shell operates a 5 million tonnes a year LNG import facility in Gujarat, Total of France has partnered with Adani Group in city gas projects.

Pradhan said the exploration acreage offered speaks volumes about the government's intent and policies.

"If our policy is not investment friendly, if our policy is not open, if our policy is not transparent, how this kind of investment is coming," he asked.

Photograph: Amit Dave/Reuters