ONGC to increase natural gas output 53% as new fields start

Oil and Natural Gas Corporation said on Wednesday its natural gas output will rise by over 53 per cent to 100 million standard cubic metres a day by 2017-18 as new fields start off the west and east coasts.

The newer gas finds will help turn the tide for ONGC, which has seen oil and gas output stagnating in recent times.

"Natural gas production will rise from about 65 mmscmd currently to over 100 mmscmd in 2017-18," ONGC Chairman and Managing Director Sudhir Vasudeva told a news conference in New Delhi.

ONGC's western offshore C-Series gas field has proved to be more prolific than previously predicted.

"The reserves of 30 billion cubic meters have been upgraded to 130 bcm because drilling in some of the eight structures in the C-Series field has yielded more gas," Vasudeva said.

The fields, which currently produce 3 mmscmd, will double output this year and another 7 mmscmd would be added when the Daman structure in the field starts output in 2016.

"The C-Series field, which is a 3 mmscmd field, will become 13 mmscmd," he said.

ONGC's showpiece KG-DWN-98/2 block off the east coast, which sits next to the KG-D6 gas discovery area of Reliance Industries, would start production "by 2017-18, if not by 2016-17," he said.

Vasudeva said the neighbouring G-4 field will contribute 9 mmscmd and the entire east coast has the potential to produce 35 mmscmd. ONGC plans to use Reliance's KG-D6 infrastructure to bring the discovery in the Krishna Godavari basin to production.

The G-4 field lies about 10 km from Reliance's offshore facilities.

Aker Solutions may be hired to assess the economic and technical feasibility of laying a pipeline to carry gas from the field to Reliance's offshore gas gathering station and then to its landfall facilities at Gadimoga near Kakinada.

ONGC signed a memorandum of understanding with Mukesh Ambani-run Reliance in July to explore the possibility of sharing the east coast infrastructural facility.

If successful, the same concept will be considered for the nine gas discoveries in ONGC's KG block KG-DWN-98/2, which sit next to Reliance's flagging KG-DWN-98/3 or KG-D6 block.

Instead of setting up separate gas processing and transportation facilities, ONGC is looking to hire Reliance's under-utilised gas gathering station at KG-D6 along with pipelines to take the fuel to land as also its processing plant at Kakinada in Andhra Pradesh.

Reliance's pipelines and other facilities are capable of handling gas output of 80 mmscmd.

Output at KG-D6 has dipped to below 14 mmscmd from 69 mmscmd in March 2010 and the company has indicated it may never touch 80 mmscmd due to unexpected geological complexities.