By In a significant development, the state-owned Oil and Natural Gas Corporation (ONGC) has commenced oil production from its long-awaited flagship deep-sea project in the Krishna Godavari basin in the Bay of Bengal. This milestone marks a crucial step towards reversing the years of decline in output for the company.
Inauguration of Oil Production
ONGC announced the commencement of oil production from the deep-water KG-DWN-98/2 block in the Bay of Bengal on January 7, marking a significant achievement for the company. While specific production figures were not disclosed by either ONGC or Oil Minister Hardeep Singh Puri, it is anticipated that this project will substantially boost ONGC’s overall oil and gas production.
Projected Impact on Production
According to ONGC, the 98/2 project is expected to increase the company’s total oil and gas production by 11% and 15%, respectively. This surge in production is attributed to the anticipated output from the Cluster-2 discoveries within the block.
Operational Details
The KG-DWN-98/2 block, adjacent to Reliance Industries’ KG-D6 block, boasts numerous discoveries categorized into clusters. The initial focus is on Cluster-2, with expectations of significant oil and gas extraction. Despite facing delays due to the COVID-19 pandemic, ONGC persevered in executing Phase 1 of the project, achieving gas production from the U field in record time.
Technological Innovations
Overcoming unique technical challenges posed by the waxy nature of the crude, ONGC employed innovative pipe-in-pipe technology, a first-of-its-kind initiative in India. While some subsea hardware was internationally sourced, highlighting ONGC’s commitment to ‘Make in India,’ the majority of fabrication occurred domestically, promoting self-reliance in the energy sector.
Future Outlook
The project remains on track, with plans to commence production from the remaining oil and gas fields by mid-2024. The expected peak production from the field is estimated to reach 45,000 barrels of oil per day and over 10 million metric standard cubic meters per day of gas.
Project Overview
The KG-DWN-98/2 block encompasses multiple clusters, each with its own development plans. Cluster-1, comprising three discoveries, is currently in the development stage, with field development plans approved for two discoveries in 2019. Cluster-3 houses an ultra-deep water gas discovery, scheduled for monetization in the future.
Revised Output Projections
While initial estimates anticipated substantial oil and gas production from Cluster-2, ONGC is now projecting a more conservative output. Cluster 2A is expected to yield 45,000 barrels per day of oil and up to 2.5 million metric standard cubic meters per day of associated gas, while Cluster 2B is projected to produce approximately 9 million metric standard cubic meters per day of gas.
