RoydadNaft –  India’s Oil and Natural Gas Corp (ONGC) has successfully produced the first oil from the deepwater KG-DWN-98/2 Block, located off the coast of the Bay of Bengal.

The 98/2 project is expected to boost ONGC’s total oil production by 11 percent and gas production by 15 percent, the state-run company said in a news release Monday.

ONGC said it is nearing completion of the project’s second phase, after completing the first phase in March 2020. The company noted that field development faced technical challenges “due to the waxy nature of the crude”, which it overcame by employing pipe-in-pipe technology. Majority of the fabrication was done domestically, with some subsea hardware sourced internationally to meet specific requirements, the company added.

The ONGC flagship project is on track, with the rest of the fields set to produce in mid-2024 in the final phase. The peak production of the field is expected to be 45,000 barrels of oil per day and over 353.15 million standard cubic feet (10 million standard cubic meters) per day of gas, the company said.

India, Guyana to Sign MoU on Oil, Gas Cooperation

On the international front, the government of India approved the signing of a memorandum of understanding (MoU) with the government of Guyana regarding cooperation in the hydrocarbon sector.

The proposed MoU covers the complete value chain of the hydrocarbon sector, including the sourcing of crude oil from Guyana, the participation of Indian companies in the exploration and production sector of Guyana, cooperation in the areas of crude oil refining, collaboration in the natural gas sector, and collaboration in clean energy, according to an official announcement from India’s Press Information Bureau (PIB). The MoU aims to strengthen bilateral trade and foster investment between the two nations.

Upon the signing of the MoU, it will be valid for five years, automatically renewing for the same period unless terminated by either party.

India is targeting new partnerships in the hydrocarbon sector as research from the International Energy Agency (IEA) estimates that the country’s energy demand will grow around 3 percent per year, compared to the global rate of 1 percent. India is also projected to account for approximately 25 to 28 percent of global energy demand growth between 2020-2040. Meanwhile, Guyana has seen new discoveries of 11.2 billion barrels of oil equivalent recently and is projected to have a significant increase in production, according to the announcement.

Recently, India’s Petroleum and Natural Gas Ministry signed contracts for 13 hydrocarbon blocks opened for bidding in the last two years. Of the new contracts, 10 came from the 2023 Open Acreage Licensing Policy (OALP) Bid Round VIII, which offered 34,364 square kilometers (13,268.02 miles). Three were under the 2022 Special Coalbed Methane (CBM) Bid Round, which opened 5,817 square kilometers (2,245.96 miles).

In the eighth round of the OALP, 13 companies made offers for the 10 blocks put forward. Four companies emerged successful, committing a total of $233 million for exploration work, according to a separate news release from India’s PIB.