The Hindu Business Line : ONGC joins hands with Prize Petro, HPCL, M3nergy

The deal
Prize Petroleum would be responsible for log and seismic interpretations, reservoir management and production facilities for the development of the fields.
M3nergy will be looking after the production and processing related operations.
HPCL will do the project management and related activities.

New Delhi , Sept. 27

Oil and Natural Gas Corporation Ltd (ONGC) on Wednesday entered into a service contract for development of three offshore marginal fields with the consortium of Prize Petroleum Company Ltd, Hindustan Petroleum Corporation Ltd (HPCL) and M3nergy (Malaysia).

The consortium, led by Prize Petroleum, has been awarded this service contract under an international competitive bid by ONGC for development of three offshore marginal fields under Cluster-7 (B-192, B-45 and WO-24) in southwest Mumbai High field.

Prize Petroleum would be responsible for activities such as log and seismic interpretations, reservoir management and production facilities for the development of the fields. While M3nergy will be looking after the production and processing related operations, HPCL will do the project management and related activities.

A capital investment of about $166 million and operational expenditure of $313 million have been planned by the consortium, for the development of all the fields in the cluster. According to ONGC, 13 wells are to be drilled during assessment period of three years from two platforms. The envisaged peak oil production is 18,865 barrels of oil per day and gas 0.887 million standard cubic metre per day with cumulative oil production of 46.42 million barrels and gas production of 2.7 billion cubic metre (BCM).

The project will be completed in two phases; an initial development phase of three years and final development phase till the end of the field's economic life.

For increasing production by unlocking small pools of discovered hydrocarbons reserves, ONGC said that development of marginal fields is one of the strategic business pursuits of the company. ONGC has identified 153 such fields out of which 38 fields have been monetised and 94 fields are under monetisation, the company said.

Marginal fields have low oil and gas reserves, which are economically viable when produced with low capital cost and overheads. This is best possible when outsourced to smaller companies. In the first round of out sourcing of offshore fields, 19 offshore marginal fields were identified for development through service contract with participation of national and international companies, ONGC said.

Prize Petroleum was promoted as an oil exploration and production company by HPCL. Other investors include three major financial institutions of India: ICICI Ltd, HDFC Ltd and ICICI ventures.