Four sedimentary basins likely to hold 22 billion barrels of oil: S&P

Andaman Sea a focal point for oil exploration, S&P Global Commodity Insights said

Four largely unexplored sedimentary basins—Mahanadi, Andaman Sea, Bengal, and Kerala-Konkan—are estimated to have hydrocarbon potential of about 22 billion barrels of oil equivalent, S&P Global Commodity Insights said on Monday.

Recent findings by global exploration companies in the North-Sumatra Basin, which lies in Indonesian waters just off the Andaman and Nicobar Islands, have made the Andaman Sea a focal point for frontier exploration, S&P said.

Over the past three to four years, global exploration companies have increasingly focused on deepwater and ultra-deepwater areas in pursuit of major discoveries, S&P said, attracting attention to the four category-II and category-III basins in India. The recent findings by Harbour Energy and Mubadala in the North-Sumatra Basin have made the Andaman Sea a focal point for frontier exploration, it added.

"ONGC and Oil India hold acreages in the Andaman waters under the Open Acreage Licensing Program (OALP) and have planned a few significant projects. However, India still awaits the entry of an international oil company with deepwater and ultra-deepwater exploration expertise to participate in current and upcoming OALP bidding rounds and explore these frontier regions," said Rahul Chauhan, upstream analyst at Commodity Insights.

Currently, an estimated 10 per cent of India's 3.36 million sq km wide sedimentary basin is under exploration, and the government plans to increase this to 16 per cent by the end of 2024. However, this is far below the government's target of India's exploration acreage to 1 million sq km by 2030. It has already reduced the 'No-Go' areas in India’s exclusive economic zone by almost 99 per cent.

Under OALP, India allows upstream companies to carve out areas for oil and gas exploration. Exploration companies can put in an expression of interest for any area throughout the year. Such interests are accumulated thrice a year following which the areas sought are put on auction.

Exploration and production (E&P) activities in India's oil and gas sector offer investment opportunities worth $100 billion by 2030, and the government is in favour of minimising regulatory delays, petroleum and natural gas minister Hardeep Singh Puri said last week.