India’s state-controlled Oil & Natural Gas Corporation (ONGC) is on the lookout for international partners to carry out exploration in deep-water and other blocks offshore the country's east and western coasts.
ONGC managing director Subhash Kumar told Upstream on the sidelines of the 23rd World Petroleum Congress in Houston that the company is involved in talks with potential international partners for jointly carrying out exploration in Indian waters.
“We have potential cooperation with ExxonMobil in the area of exploration... similarly, we are working with two to three major (international) companies where discussions are at an advanced stage,” Kumar said without naming the companies.
ONGC has ambitious deep-water exploration plans and recently tendered for a major 3D broadband seismic data acquisition campaign across its Andaman and Mumbai basins.
The company also plans to carry out offshore exploration in several other basins.
Kumar said ONGC remains bullish on offshore exploration, but wants to involve international partners as a part of a revamped strategy.
"Since I took over, I've written to 10 chief executives of global companies and, luckily, we have got very positive responses from most of them,” he said.
He added that international players are being approached with “very specific kind of proposals and only for the areas where they have succeeded in the past".
“So this in all likelihood will cut down on the time which is generally taken for the building of relationships,” he noted.
Despite the coronavirus outbreak and economic downturn, ONGC is maintaining a robust capital expenditure programme and plans to spend up to $4 billion during the current fiscal year (2021-2022), and has earmarked a similar capex for the next financial year.
Kumar said that as India remains overly dependent on oil imports, it would continue to spend on oil and gas projects, despite the global situation.
Out of the $4 billion target capex, he says up to $1.5 billion is likely to be spent on exploration and exploration drilling this year.
In addition, about $1 billion would be spent on development drilling, while the remaining expenditure would be on project developments.
ONGC is currently executing the $5 billion-plus KG-DWN-98/2 deep-water development offshore India's east coast, which has been delayed due to Covid-19 concerns.
“Due to disruptions in our international supply chain, it appears that the timelines are getting extended,” admitted Kumar.
However, he remains hopeful that the deep-water project could start producing gas by next year, with oil production expected to commence from 2023.
Kumar said India’s oil demand has bounced back to pre-Covid levels and he is not overly concerned about the Omicron variant.
"Omicron is supposed to be much, much milder. And also, probably it will spread faster. So the peak will be there, if at all, for a very short period,” he said.