Hyderabad: State-run Oil and Natural Gas Corporation (ONGC) is all set to start production of natural gas and oil from its offshore blocks, G1 and GS15, in the KG basin by month end and is awaiting a nod from the PMO for formal inauguration, sources said.
As this is the first offshore block of the PSU in the Krishna-Godavari basin being put into production, it is apt for Prime Minister to inaugurate the facility, a senior official, who did not want to be quoted, said.
“As the first offshore block of the country, Mumbai High in the West Coast was inaugurated by then PM Indira Gandhi, we want the present PM Manmohan Singh to inaugurate the East Coast offshore field,” the official said.
With the new facility, the initial production of gas is set to touch two million standard cubic meters (SCM) and that of associated oil to 9,400 barrels per day, sources said.
The oil and natural gas major, which has 24 blocks in the basin, currently produces 840 tonnes of oil per day and 3.8 MMSCD of gas from its onshore blocks.
While, the G1 is located 28 kms off Amalapuram coast in water depths ranging from 135 to 500 meters, the GS 15, in shallow waters, is located at 5 kms from the coast in KGbasin.
The project is almost five years behind schedule with the cost overruns following delay on part of the Australian contractor Clough Engineering who eventually quit the project.
The production of the gas was originally scheduled to start from the integrated field way back in April 2006, at an estimated cost of Rs 1,200 crore.
Leighton India had been awarded a $17 million contract for completion of the offshore installations.
Since these blocks were allotted on nomination basis, ONGC gets 60% of the international price for oil and $4.2 per BTU for gas.