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Business News/ News / India/  India hurries ops at terror-hit gasfield amid volatile prices worries
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India hurries ops at terror-hit gasfield amid volatile prices worries

The operating committee of the Mozambican gasfield, where an ONGC Videsh-led Indian consortium has a 30% stake, is set to meet by the end of this month to speed up work

Operations at the ‘Offshore Area 1’ project in the coastal town of Palma were suspended in April 2021, following attacks by Islamic State terrorists. (Photo: Reuters)Premium
Operations at the ‘Offshore Area 1’ project in the coastal town of Palma were suspended in April 2021, following attacks by Islamic State terrorists. (Photo: Reuters)

New Delhi: The operating committee of the Mozambican gasfield where an ONGC Videsh-led Indian consortium has a 30% stake is set to meet by the end of this month to review progress in resuming operations at the $20 billion project.

Two people in the know said the meeting would look at speeding up the process of resumption.

Total E&P Mozambique Area 1 Limitada, a subsidiary of TotalEnergies, holds 26.5% in the plant and is its operator.

Operations at the ‘Offshore Area 1’ project in the coastal town of Palma were suspended in April 2021, following attacks by Islamic State terrorists.

“Efforts have been underway to resume the project at the earliest. The security situation is being reviewed. Construction of the project is likely to resume in first half of 2024," said one of the two people mentioned above.

Three Indian state-run companies hold a total of 30% in the project. ONGC Videsh holds 16%, BPRL Ventures Mozambique BV, a subsidiary of BPCL, 10% and Oil India Ltd 4%. Queries mailed to TotalEnergies, OVL, BPCL and Oil India remained unanswered till press time.

Efforts to resume operations follow volatility in the global energy market due to the Ukraine war.

Petroleum and natural gas minister Hardeep Singh Puri visited Mozambique in October to discuss the project with the host nation’s minister of mineral resources and energy Carlos Zacarias.

India seeks to increase the share of gas in its total energy mix to 15% by 2030 from the current 6%.

Supplies from Mozambique reach India three to seven days by sea, making it a far better than several other suppliers.

LNG supplies from the US, the second largest supplier of LNG to India take about 25-50 days to reach India.

The website of the project, mzlng.totalenergies.co.mz, shows that the development phase of the project, before production of gas, can begin once a well is drilled and commercial quantities of natural gas have been confirmed through appraisal activities.

“Development generally includes preparing wells for production. Because the natural gas found in Mozambique’s Offshore Area 1 is approximately 40 kilometers offshore and in water depths of approximately 1,600 meters, specially engineered equipment is required to produce, gather, process and transport the natural gas to the onshore facilities for processing," says the website.

Earlier in February 2023, the chairman and CEO of TotalEnergies, Patrick Pouyanne, visited Cabo Delgado to review the security and humanitarian situation and he entrusted Jean-Christophe Rufin, an expert in humanitarian action and human rights, to assess the humanitarian situation in Cabo Delgado.

India has been trying to widen its source base for its energy needs. The country currently depends on imports for as much as 85% of its oil needs and 55% of its natural gas demand.

So far in FY24 (April-December) India has imported 22,856 million metric standard cubic meter (mmscm), against 20,011 mmsc in the year ago period. Qatar is the largest supplier of gas followed by the UAE and the US.

Last week, at the India Energy Week, state-run Petronet LNG signed a long term contract with QatarEnergy for supply of 7.5 million metric tonne per annum LNG during 2028-2048. This 20-year deal is an extension of an existing contract for LNG supply of around signed on 31 July 1999 for supplies till 2028.

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Published: 15 Feb 2024, 04:34 PM IST
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