AHMEDABAD: Multi-sector infrastructure major Megha Engineering and Infrastructure Ltd (MEIL) is eyeing a $2 billion (~Rs 14,800 crore) boost to revenues by selling indigenously manufactured rigs to oil and gas exploration majors across the world.
The company announced on Thursday that two such rigs are already on-site at ONGC’s fields, with one already operational.
The second rig is set to begin operations at ONGC’s oil well near Dhamasana village, Kalol, Gujarat in a matter of days.
In total, MEIL will deliver 47 oil rigs to ONGC’s oil and gas fields across India at a project cost of $860 million (over Rs 6,000 crore).
While the third rig is set to be handed over soon, MEIL will deliver 23 rigs to ONGC by the end of this financial year (March 2022). Fourteen of these rigs are already being transported to different oil and gas fields across India, top MEIL executives said.
“Until recently, India was mostly dependent on imports for oil and fuel extraction rigs, but MEIL has significantly boosted domestic rig manufacturing capacity. The second rig handed over to ONGC is manufactured with state-of-the-art hydraulic and automated technology,” said N Krishna Kumar, Head-Oil Rigs Division, MEIL.
The indigenous component level in the advanced rigs is 50% at present, and will be increased to 90% over time, according to Rajesh Reddy, Vice-President, MEIL.
So far, India has imported over 80% of the gear needed in the oil drilling process, but MEIL executives note that its push to localise rig manufacturing will significantly reduce the country’s import dependency for this critical sector.
MEIL had acquired the Italy-based Trevi Group’s Drillmec, an oil rig manufacturer, two years ago and has used the acquisition to build up its technology and local manufacturing capacities.
MEIL currently has two major manufacturing facilities for the sector in Hyderabad and Kakinada and has invested $200 million (~Rs 1,400-1,500 crore) in developing these facilities so far.
According to Kumar, MEIL’s new rigs are more advanced and safer than the older conventional rigs in operation in the Indian market. MEIL will manufacture and deliver the 47 rigs to ONGC assets in Assam (Shib Sagar, Jorhat), Andhra Pradesh (Rajahmundry), Gujarat (Ahmedabad, Ankleshwar, Mehsana and Cambay), Tripura (Agartala) and Tamil Nadu (Karaikal).
The company is also interested in expanding its oil and gas exploration and production business, company officials said, adding that it is planning to participate in the bidding for the next round of oil and gas fields set to go under the hammer soon.