November 11, 2018
By offloading non-priority assets, the state-run ONGC is aiming to focus on premium assets
This comes amid the Government's measures to better monetise domestic oil and gas reserves
India holds estimated oil and gas deposit of 28 trillion tonnes - 60% is yet to be harnessed
In August 2018 India put up 26 oil and gas assets for auction with reserves worth US$14.3 billion
Ministry of Petroleum and Natural Gas is planning to offer up to 149 oil and gas fields that are currently operated by Oil and Natural Gas Corporation (ONGC) to private and foreign investors, according to media reports on November 11, citing officials with knowledge of the matter. By offloading these non-priority assets, the government-run oil and gas explorer is aiming to focus on its premium oil and gas fields. This comes amid the Government’s measures to better monetise the nation’s oil and gas reserves. India holds estimated oil and gas deposit of 28 trillion tonnes, of which 60 per cent is yet to be harnessed.
While India’s proven oil reserves stand at 635 million tonnes, proven natural gas deposits and estimated shale gas reserves are recorded at 54 trillion cu ft and 96 trillion cu ft, respectively. The sale of ONGC’s assets come amid the Government’s plan to substantially raise domestic oil and gas exploration, while cutting down on imports. In August 2018 Government of India had put up 26 oil and gas contracts areas for auction with reserves worth around US$14.3 billion. The bid round–II under the state’s Discovered Small Field Policy involved 60 discovered small fields with reserves in place of about 195 million tonnes.
In the bid round–I last year, 46 assets were offered, out of which 34 had received more than 130 bids. In May, an open acreage auction of 55 oil and gas blocks by the Directorate General of Hydrocarbon, Indian energy regulator, had received 110 bids, asserting investor confidence in the sector. The Union Cabinet had recently approved a policy to promote and incentivize more efficient methods – including enhanced recovery (ER), improved recovery (IR) and unconventional hydrocarbon (UHC) production – to improve recovery factor of domestic hydrocarbons. Since 2000, over 250 blocks have been alloted to bidders.