ONGC Awaits Pricing of Gas

Oil and Natural Gas Corp. is awaiting the approval of gas price and identification of users from India's petroleum ministry, failing which it may start flaring gas and oil from Krishna-Godavari basin field GS-15, off the Andhra coast.

"The field is primarily an oil field and gas is produced as associated gas. So if there are no takers, we'll produce oil and flare gas," commented an ONGC official.

ONGC has asked the ministry to approve a price of USD 4.75 per million British thermal units (mmBtu).

While production from some oil wells in the GS-15 field is likely to commence from September, ONGC has drawn up plans to begin production from its G-1 field in the KG Basin from July next year, the official said.

ONGC envisages the production of 5.92 billion cubic metres of gas over a period of 15 years from G-1 and GS-15.

Gas availability will start in September at 0.19 million standard cubic metres of gas per day, increasing to 1.52 mmscmd from July next year (subsequent to the G-1 field coming onstream), peaking at 1.72 mmscmd in 2013-14 and tapering to 0.029 mmscmd by 2022-23.

G-1 is located 28 kilometres off the Amalapuram coast, in water depths ranging from 135 to 500 metres, while GS-15 is located 5 km from the coast in the KG basin.

G-1 and GS-15 which are two marginal fields awarded to ONGC on a nomination, are being developed together at an estimated cost of approx $240 million.

Source: moneycontrol.com