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The huge subsidy burden is hindering Oil and Natural Gas Corporation’s (ONGC) efforts to explore new oil and gas finds.
According to Sudhir Vasudeva, Chairman and Managing Director, in the first half of this financial year the corporation’s subsidy outgo was Rs 23,400 crore.
“By the end of the financial year, the burden will grow to Rs 53,000-54,000 crore,” Vasudeva told mediapersons here.
He noted that ONGC spent “38-40 per cent” of its budget for survey and exploration.
Vasudeva pointed out that the first commercial shale gas location was discovered in the Jambusar field in Gujarat less than a month back.
The discovery was made soon after the Government had come out with its shale gas policy. The policy gave huge exploration opportunities for ONGC and Oil India.
He said as of now, the shale gas potential was meagre in India. Many agencies had come out with different estimates of the potential. There were several challenges facing the exploration. Land availability was a major one.
Development of service industry catering to the exploration needs was crucial as hundreds of wells and rigs would be involved in the process.
Vasudeva noted that though there have been 249 blocks awarded for exploration of oil and gas resources the discoveries had not been commensurate with exploration.
There were two issues: above ground, which concerned policy framework and pricing; and, below ground, which concerned technology. While the above-ground issues were now being addressed, the technology aspect needed more focus.
Kerala-Konkan basin
He said ONGC’s exploration in the two blocks in the Kerala-Konkan basin would continue. There were 15 wells, of which, six were deep wells.
Drilling would begin in one well around March next.
At the tenth biennial international conference of the Society of Petroleum Geophysicists which opened here, Vasudeva asked geoscientists to gear up to explore and exploit the new energy resource.
Union Oil and Natural Gas Minister Veerappa Moily inaugurated the three-day event.
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