Business Daily from THE HINDU group of publications
Monday, Jan 08, 2007
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Business Daily from THE HINDU group of publications Monday, Jan 08, 2007 ePaper |
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Petroleum Corporate - Outlook
Richa Mishra
Ticklish issue The demands and requirements of the exploration wing has to be considered. There is need for dedicated resources to meet work schedule.
New Delhi , Jan. 7 ONGC, which is examining the prospects of rig sharing with other exploration and production (E&P) companies, is yet to take a final call on the issue. The E&P companies are looking at various cost saving options including rig pooling in order to enhance their core activities. Speaking to Business Line Mr U.N. Bose, Director (Technology and Field Services), ONGC, said, "We are still weighing the pros and cons of such a move. Currently, we are placed in a situation where we have a large fleet — jack up, floater and deepwater — of rigs. However, for ultra deep water drilling, the company is considering the idea of rig pooling, as rig availability is poor in this category." ONGC till now has not made any commitment for rig sharing with other companies, as it would also depend on the demands and requirements of the exploration wing of the state-owned company. Before committing to rig sharing a lot of issues would have to be clarified, such as priority of using the rig, minimum work programme and division of work, he added. While the concept of rig sharing may be beneficial for companies having smaller number of work programmes, for a company like ONGC it could be difficult, as it has large work programmes and totally dedicated resources are required to fulfil the work programme, Mr Bose said. The company has continuous work programme and thus it makes it difficult for it to divide the work. As per industry estimates, drilling rates for sophisticated deepwater rigs have gone up from about $200,000 a day to more than $400,000 in the last one-and-a-half years. ONGC currently has two deepwater rigs — Discoverer Seven Seas and Belford Dolphin — deployed in Mahanadi Basin and Krishna Godavari Basin, respectively. In response to a Directorate-General of Hydrocarbons initiated rig-sharing project, almost 11 E&P companies, both domestic and foreign, have associated themselves with the project. This would enable the companies to bring down the cost of hiring rigs, one of the major components for exploration activities. The 11 companies participating in the project are Oil India Ltd, GAIL (India) Ltd, Reliance Industries Ltd, Niko Resources Ltd, Hardy Exploration, Gujarat State Petroleum Corporation Ltd, Hindustan Oil Exploration Company Ltd, Jubilant Oil & Gas, Cairn Energy, BG Exploration & Production India Ltd and ENI. ONGC, however, is not part of the project, till now.
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