ONGC to finalise sharing of RIL facilities in 9 mths

Sources say RIL may also be asked to share the profit with govt via sharing of facilities with ONGC

State-run ONGC Ltd has said that it would finalise on the sharing of the unutilised infrastructure facilities of Reliance Industries (RIL) at KG-D6 in nine months time.

Recently, both companies had signed a memorandum of understanding to explore sharing of RIL facilities with the PSU major. Meanwhile, an official sources close to the development said that RIL may be asked to share the profit with government through sharing of those facilities with ONGC.

“We have not yet finalised on using the facility of RIL in KG-D6. The company is in the process of appointing a consultant, which would submit a report in the next nine months time regarding the feasibility of using RIL facilities,” said P K Borthakur, director (offshore), ONGC.

ONGC had made nine gas discoveries with more than 4.8 trillion cubic feet of gas in its KG-DWN-98/2, which is close to RIL block in Krishna Godawari basin. Though the facilities were supposed to handle about 80 million standard cubic meters per day (mmscmd), the production from RIL blocks have come down to about 15 mmscmd due to technical reason. “Our plan is to join these gas processing and transportation facilities of RIL rather than putting up separate facilities,” he added. ONGC is expecting to start production in these blocks by 2016-17.

Meanwhile, the Comptroller and Auditor General (CAG) has questioned the hiring of a rig by ONGC from the Mukesh Ambani-led company at a cost of Rs 146.71 crore for a period of six month (from February-July 2009) to drill at three locations.

It was in November 2008 that ONGC received an offer from RIL for sharing the latter’s rig along with additional service and equipments for a period up to July 1, 2009. The rig had a capacity to drill wells up to a water depth of 600 meters. CAG in its report said, “Actual deploymet of the rig indicated that its hiring was not necessary for any of the three identified locations.” It added that the rig was hired “without calling for competitive bids.”