The Hindu Business Line : ONGC to resume drilling in Bengal offshore soon

Kolkata. Sept. 25 ONGC will resume drilling in Bengal offshore (WB-OSN-2000/1) shortly. Ending almost a one-and-a-half year-long hiatus, the Union Petroleum and Natural Gas Ministry has finally granted six months extension to complete exploratory drilling. Drilling was suspended in the block since early 2006 after DGH refused fresh extensions.

The regulator previously granted 18 months extension to ONGC for carrying out the minimum work programme in the block. While DGH felt that this was the maximum they could grant as per the production-sharing contract (PSC), ONGC argued that the last extension was granted with retrospective effect.

According to the company, it had received the formal communication favouring the last extension almost at the end of the extended time period. No DGH officials were available for comment.

Govt intervention

Responding to an appeal by the company in January 2007 seeking intervention of the government in resolving the crisis, the Ministry has finally given its nod in favour of ONGC. In a communication dated August 17, the company was granted the desired extension.

“We have received the much approval. We are now planning to press at least two rigs in service to complete three wells in six months,” the sources said.

The source, however, admitted that the job was easier said than done, as rig insurance underwriters generally bar rig movement on the east coast till January. “According to the underwriters, October to January are cyclone prone months on the East coast,” he said, adding that the company was confident to overcome the challenge.

It may be mentioned that in March 2005, ONGC launched a campaign to drill four exploratory wells in the block in two years. Series of technical problems including restraints used by underwriters on rig movement finally led the company to end the campaign in March 2006 drilling only one well, without any success.

Strikingly, despite its “potential” – arising out of proximity to the gas finds in Bangladesh and Myanmar –oil and gas exploration in Bengal offshore and bordering North Eastern Coast (NEC) has never been successful. The history was repeated once again during the ongoing exploration by Gazprom-GAIL in NEC-OSN-97/1 block (bordering the WB-OSN/ 2001/1 block).

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Bengal offshore: Extension delay puts ONGC in a fix
Bengal offshore: Ministry favours ONGC's request for extension

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