ONGC inks pacts with Schlumberger, Halliburton for two fields

State-owned Oil and Natural Gas Corp (ONGC) today signed agreements to practically outsource production of oil and gas from its ageing fields in Gujarat and Assam to international service providers Schlumberger and Halliburton.
Under the plan, ONGC will give out its Kalol field in Gujarat to Halliburton and Geleki field in Assam to Schlumberger. The two service providers would bring in necessary technology for boosting output.
"A base production level will be decided. They (Schlumberger and Halliburton) will be paid a certain USD dollar per barrel fee for producing oil beyond this agreed level," ONGC Chairman and Managing Director Dinesh K Sarraf said.

All the oil produced will belong to ONGC and the arrangement is being entered into to get the best technology available, he said.
The Summary of Understanding (SoU), signed on sidelines of Petrotech conference, is for Production Enhancement Contract in the two fields.
"If we were to hire a certain technology and it failed, we would have to spend more money in bringing alternate technology. Now it is their responsibility to bring in whatever technology is needed. They get paid only if production exceeds the agreed base level," he said.

Under the terms, Schlumberger and Halliburton will invest capital and share technical expertise in the two stagnant but producing oilfields.

If they are able to increase output, they will be paid a pre-determined fee on each additional barrel of crude oil produced.
Besides Schlumberger and Halliburton, ONGC is also in talks with Weatherford International and Baker Hughes Inc among others.