NEW DELHI: The state-owned Oil and Natural Gas Corporation (ONGC) expects to produce 5 MMtoe (million tons of oil and oil equivalent) in the next few years from its ongoing new projects across the country.
The company expects the majority of this production to come from the 98/2 field, estimated to contribute around 4 MM toe. Additionally, the Daman Upside project is projected to yield around 1.5 MMtoe. Furthermore, the CBM (coal bed methane) project in Jharia and Bokaro is anticipated to add around 0.5 MMtoe to the total output.
“Moving forward in the next three years, we expect to produce around 5 million metric tons of oil and oil equivalent from these new projects,” the company said in an investor call.
“The major chunk will be coming from the 98/2 field at around 4 MMtoe, followed by Daman Upside at around 1.5 MMtoe. Additionally, the CBM project in Jharia and Bokaro is expected to contribute around 0.5 MM toe.”
The total capital expenditure (CapEx) for these ongoing projects is estimated to be around R60,000 crore over the next two to three years. These projects are expected to generate a lifecycle gain of around 80 million metric tons of oil equivalent.
In January 2024, ONGC successfully commenced First Oil production from its deep-water KG-DWN-98/2 Block, located off the coast of the Bay of Bengal. The ONGC reported a net profit, or profit after tax, of R9,536 crore for the third quarter (Q3) of FY24.
This represents a decrease of R1,509 crore, or 13.796%, compared to R11,045 crore earned in Q3 of FY23.
The reason for the low profit was on account of lower sales revenue, mainly due to lower crude oil, natural gas production, and VAP price realisations and the provisions of GST on royalty.
The company also mentioned that it is engaging with the government regarding the SEAD, or windfall tax.
‘Engaging with govt regarding windfall tax’
In January 2024, the state-owned Oil and Natural Gas Corporation successfully commenced First Oil production from its deep-water KG-DWN-98/2 Block, located off the coast of the Bay of Bengal. The company also mentioned that it is engaging with the government regarding the SEAD, or windfall tax. “We will be continuing to engage with the government regarding the applicability of SAED and hopefully obtain a positive outcome,” the company said.