The Hindu Business Line : ONGC strikes gas in Mahanadi for the second time

Block data
It's ONGC's second strike in Mahanadi since Dec 2006.
Preparing to drill second exploratory well in block.
Discovery turns region into a major hydrocarbon source.

Kolkata May 21 ONGC has struck gas in MN-DWN-98/3 deepwater block in Mahanadi basin. The company holds 100 per cent interest in the block. This is ONGC's second strike in Mahanadi basin since December 2006, when it reported a find in MN-OSN-2000/2 block.

Interestingly, sources said that the Indian E&P major is also considering divesting a minority stake in the block (MN-DWN-98/3) in favour of ENI Italy. This is in exchange of a participatory stake in the latter's exploratory assets in Congo.

In February this year, ONGC and ENI entered into a stake swapping agreement according to which ENI acquired 34 per cent stake in MN-DWN-2002/1 block in Mahanadi for 20 per cent participatory interest awarded to ONGC in the MTPN exploration block in Congo.

Confirming the fresh strike in Mahanadi basin, sources said that the testing (mud drill test) results at the first well in MN-DWN-98/3 NELP-I block is positive. The Director-General of Hydrocarbons (DGH) has been informed about the same.

The company is, in the meantime, preparing to drill the second exploratory well in the block. "We have already identified the location for spudding the second well and drilled an investigatory hole. The logging data is extremely encouraging and may lead to further discoveries in the block," an ONGC official said.

Talking about the size of the discoveries in the basin so far, the official said: "the discoveries are not very big in nature. However, it may help us strike more oil and gas sources in the region."

Emerging source

ONGC's fresh discovery establishes the emergence of Mahanadi and the North Eastern Coast basins as a major source of hydrocarbon. Reliance has already struck a string of seven successive discoveries in the NEC-25 block.

According to Niko Resources, which holds a participatory 10 per cent interest in NEC-25, the block may have over 8 trillion cubic feet of reserves.

According to sources, the drilling activity in NEC-OSN-97/1 block held by OAO Gazprom (50 per cent) and GAIL (50 per cent) also indicates the presence of gas.

Though the first well in the block went dry, the responses in the second well are reportedly encouraging.