New Delhi: India’s biggest explorer, Oil and Natural Gas Corp. Ltd (ONGC) expects crude oil output at its Brazilian field to increase sharply to 40,000 barrels per day (bpd) by the end of the year, helping the energy-starved country expand its overseas production.
The BC-10 deepwater block in Brazil, which currently produces about 5,500bpd, started contributing to ONGC’s overseas production from July. ONGC has a 15% stake in BC-10.
State-run ONGC currently gets about 160,000-170,000bpd from its foreign assets, which have been bought by its ONGC Videsh Ltd arm to secure energy supplies for India’s expanding economy.
“We are producing from one well and we plan to put five more wells on production by December,” R. Butola, managing director of ONGC Videsh, said of the Brazilian project on Wednesday.
Low production: The Sakhalin I field in Russia. Output from the field, in which ONGC Videsh has a 20% stake, is set to fall this year
Output from two of its major projects, Sakhalin I in Russia and Greater Nile Oil project in Sudan, was set to fall this year due to natural decline, he said.
The Sakhalin I project, in which ONGC has a 20% stake, has been producing oil for several years and reached peak production of 11.2 million tonnes (mt) in 2007.
“The output has declined but from late 2011 or early 2012 it will gain,” Butola said. In the Sudan project, output has fallen to 175,000bpd, he said.
Crude oil output from from its San Cristobal project in Venezuela can rise above 40,000bpd from a current 32,000bpd, he said, but did not elaborate.
ONGC chairman R.S. Sharma said ONGC had nearly doubled crude output from Imperial Energy Ltd’s assets in West Siberia to 11,500bpd. ONGC completed its acquisition of Imperial this year.
ONGC wants to increase its local oil output by 14% to 580,000bpd and gas production by 16% to 72 million cubic metre a day by the end of 2012-13.
As part of this, ONGC is investing Rs30,000 crore to improve output from its ageing fields, Sharma said.
It has already spent Rs14,000 crore to improve output, Sharma told shareholders, without specifying the period. The so-called recovery rate was 33% in the year ended March, compared with 28% eight years earlier, he said.
The firm, which contributes about two-thirds of India’s oil output, plans to invest at least $1 billion (Rs4,800 crore) to bring east coast oil and gas fields to production starting mid-2010, said Sudhir Vasudeva, head of offshore operations at ONGC.
(Rakteem Katakey of ‘Bloomberg’ contributed to this story.)