ONGC intends to set up own power plants

Oil and Natural Gas Corporation Limited (ONGC) chairman and managing director Sudhir Vasudeva said that the state-run enterprise intends to set up its own power plants, not just gas-based but also power plants based on nuclear, wind and other unconventional energy sources.

Vasudeva inaugurated the monetisation and production operations of the onshore marginal gas fields in the KG basin operated by KEI-RSOS Petroleum & Energy Limited (KRPEL) near Rajahmundry in Andhra Pradesh on Thursday.

Speaking on the occasion, according to a release, he said that though the focus of the ONGC had been on fields with large gas potential, the recent increase in the gas prices had made it relook at such marginal fields through the public-private partnership (PPP) model.

In the first phase, the three marginal fields, of Sirikattapalli, Mulikipalli and Magatapalli will produce about 65,000 cubic metres of gas per day which will be shared equally by the ONGC and KRPEL.

According to the KRPEL, this is a risk and reward contract which has been finalised by the international competitive bidding route in line with the marginal fields policy promulgated earlier by the ministry of petroleum and natural gas.

As per the contract, the service partner KRPEL will bring the investment and expertise to rejuvenate the depleted fields of the ONGC and share the produce with the public sector enterprise in a predetermined percentage. The ONGC will not invest any money in the venture, but will hand over the designated depleted fields to the service partner. So far, the ONGC had awarded 18 such fields across the country.  

“This project at KG basin is a good example of the PPP model. This is the second monetisation of a marginal gas field, the first one was from another difficult area - Jaisalmer. We see tremendous potential in this project with an expectation of 300,000 cubic metres of gas, as there are five more wells to be drilled,” Vasudeva said.

KRPEL stated that it had laid 15 km of cross country pipelines connecting all the fields and built a gas gathering station capable of processing 500,000 cubic metres of gas per day. It would shortly commence drilling five new appraisal wells in the five fields allotted to the company. It was estimating a recoverable reserves of 1.2 billion cubic metres and is hopeful of achieving a plateau production of 300,000 to 400,000 cubic metres of gas per day.