The Hindu Business Line : ONGC to complete tendering of marginal onland fields soon

To cash in on the volatile crude market and the rising demand for oil and gas, ONGC had floated tenders for 17 onshore fields, of which bids were received for 14 fields.

Speaking to Business Line, a senior ONGC executive said: "We had floated tenders for 17 onshore fields, of which 14 received bids.

"The technical evaluation is expected to be completed in a day or two after which commercial bids would be opened."

The commercial bids are likely to be opened in 10 days, he added.

Eight companies, including BPCL, Shiv Vani, Deep Industries and Assam Company, have participated in the tender for 14 onland marginal fields.

ONGC has received 22 bids with some blocks receiving single bids.

ONGC had put on offer 18 marginal fields in Assam, Rajasthan, Andhra Pradesh and Tamil Nadu for development on service contract basis, wherein the winner would not get ownership of oil and gas and would only be entitled to a pre-fixed rate of return.

However, it withdrew one field, leaving 17 fields on offer.

ONGC has 96 marginal fields (onshore and offshore) - 42 onshore and 54 offshore.

The onshore assets produce 8.1-8.2 million tonnes of oil per annum and nearly six billion cu.m of gas.

According to the executive, these fields with proven reserves would be given on service contracts only.

The current scenario has made it economical for exploiting the marginal fields, he said.

These fields have been discovered, but not monetised, i.e., the discovered fields have not been exploited, he added.

For the onshore fields in Gujarat and Assam, contracts have been finalised for eight fields and work is under progress, according to him.

The company has awarded three onshore fields in Assam to Assam Company; in Gujarat it has awarded three to Prize Petroleum and two to GSPCL.

ONGC retains full ownership of these fields as well as the production of oil and gas.

While it monetising offshore fields on its own, it has decided on the service contract route for the onshore fields because of their small size.

On why ONGC itself was not monetising these fields, the official said: "Developing small fields for a company of ONGC's size is an expensive proposition, because it can depute its high-value professionals for larger fields.

"A leaner and focused private firm can do the job much cheaper."

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. Over the years, ONGC has discovered several marginal fields, both onshore and offshore.

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