Operating firms now pumping in thousands of crores to arrest the drop.
Two of India’s oldest oil and gas finds, Panna-Mukta-Tapti (PMT) and Ravva are facing the threat of reserve depletion.
A consortium of British Gas (BG), Oil and Natural Gas Corporation (ONGC) and Reliance Industries (RIL), which controls the PMT fields off the west coast, is spending about Rs 2,500 crore for reviving the reserve in this fiscal, while new wells are being drilled at the Cairn-operated Ravva field (off the Andhra coast) for small-sized additional discoveries.
The Tapti field has witnessed “natural decline in the production profile” during the first quarter ended June 2009. Gas production fell 26 per cent compared to the corresponding quarter last year and condensate output has dropped 34 per cent at Tapti, according to data from RIL. Panna-Mukta had first faced a decline in October-December 2008 and later enhanced production by drilling new wells, but the threat of a further decline remains, said an official with the petroleum ministry.
RIL, in a recent statement, said: “The decrease in production at Tapti was due to natural reserves’ decline in the reservoir. To arrest the declining gas production in Tapti, three infill wells (two in south Tapti and one in mid Tapti) are planned to be drilled in the third and fourth quarters of 2009-10. After drilling these wells, the gas production is expected to be ramped up from the current level of about 9 million metric standard cubic meters a day (mmscmd) to about 11 mmscmd.”
The PMT consortium is spending $400 million (nearly Rs 2,000 crore) on the Panna-Mukta fields and $110 million (over Rs 530 crore) for Tapti, said company sources. The consortium produces about 40,000 barrels per day of oil from Panna-Mukta and 14 mmscmd of gas from the Tapti area.
After a sub-sea pipeline leakage, oil production at the three fields at PMT was halted a fortnight earlier. Gas production has been impacted, with output falling to 9 mmscmd from around 14 mmscmd. On Wednesday, BG officials said the company had resumed production.
ONGC holds 40 per cent in PMT, while RIL and BG India own 30 per cent each. Panna-Mukta began producing in 1987 and Tapti in 1997. The Panna field is estimated to have original oil in place of one billion barrels and original gas in place of 1.9 trillion cubic feet (tcf). Tapti has estimated gas in place of 3.75 tcf.
Having produced at the plateau rate of 50,000 barrels of oil a day (bpd) since 1999, the Ravva oilfield had hit a declining phase since the July-September 2008 quarter. The ageing field, which has produced more than double the original reserve estimates, currently produces 36,000 barrels of oil a day and gas of 50.38 mmscmd. Originally estimated to produce about 100 million barrels of oil equivalent (mmboe) annually, the Ravva field has far exceeded the mark and has crossed the 280 mmboe milestone. Cairn and its partners have embarked on fresh exploration activity in the area to maintain the production, said company sources.
Ravva has generated approximately over $9 billion revenue and the consortium has paid over $4.6 billion in the form of profit petroleum, royalty and cess to the central government from an investment of just over $1 billion in the past decade. The field has also generated sales tax of more than $290 million for the Andhra Pradesh government.
Cairn holds 22.5 per cent stake in the Ravva consortium, in which ONGC (40 per cent), Videocon (25 per cent) and Ravva Oil (12.5 per cent) are the other partners.
Bangladesh government has shortlisted bidders for a 5-mt LNG terminal at Moheshkhali island in the Bay of Bengal