India’s Oil & Natural Gas Corporation (ONGC) has signed an agreement with Norway’s Equinor to partner in upstream exploration and production, midstream and clean-energy solutions, including carbon capture utilisation and sequestration.
The two players recently signed a memorandum of understanding to collaborate across the oil and gas value chain and clean energy, with the deal likely to be valid for two years.
However, state-controlled ONGC did not further reveal the specific projects that are likely to be targeted.
In 2013, Statoil (now Equinor) announced its exit from the gas-rich KG-DWN-98/2 asset, off India’s east coast, over government delays in approving their participation in the deep-water acreage.
While industry sources remain cautious over the participation of Equinor and other Western oil and gas giants in key ONGC offshore acreage, the Indian government believes its revamped policies and sustained higher oil prices are likely to attract investors to the nation’s oil and gas industry
International partners on radar
In December, ONGC said it is on the lookout for international partners to carry out exploration deep-water and other acreage offshore the country’s east and west coasts.
The company has ambitious deep-water exploration plans and recently tendered for multiple offshore seismic data acquisition campaigns.
ONGC remains bullish on offshore exploration but wants to involve international partners as a part of a revamped strategy.
Leading international giants are being approached by ONGC with “very specific kinds of proposals and only for the areas where they have succeeded in the past”, Upstream understands.
ONGC is currently executing the $5 billion-plus KG-DWN-98/2 deep-water development off India’s east coast, which has been delayed due to Covid-19 concerns.
Reducing carbon footprint
The company remains increasingly under pressure from the international community to reduce greenhouse gas emissions and lower its carbon footprint.
ONGC seems to be lagging far behind European energy giants in terms of sustainability and significantly lowering its emissions over the years.
One person close to the company said it needs to involve international players, which could bring in technological expertise and domain knowledge to set a clear roadmap for net zero in the long term.
Indian Prime Minister Narendra Modi last year made a surprise pledge for India to reach net zero by 2070, but the nation’s energy majors are yet to make similar commitments.
More than 70% of India’s electricity comes from coal-fired power plants and consumption of this highly polluting fuel has been on a steady rise.
The Council on Energy, Environment & Water, a Delhi-based, not-for-profit policy research institution, earlier said that India’s coal-based power generation must peak by 2040 and almost disappear by 2060 if it harbours a net-zero ambition by 2070.
The Indian government has been unable to explain how it could completely replace coal with renewables in its run-up to net zero.