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After a series of abortive attempts, ONGC has firmed up plans to rope in strategic private sector investors in three coal-bed-methane assets in West Bengal and Jharkhand.
According to sources, in April this year, the ONGC board decided to rope in two strategic partners, with 25 per cent and 10 per cent stake each, as joint operators in the North Karanpura (Jharkhand), Bokaro (Jharkhand) and Ranigunj (West Bengal) assets.
According to ONGC, each block has one trillion cubic feet of methane reserves.
The PSU major holds 90 per cent operating interest in Ranigunj and 80 per cent each in Bokaro and North Karanpura.
The farming-out of strategic interest in the most prolific Jharia block, where ONGC has a production well, has been put on hold.
The sources said Dart Energy (formerly Arrow) was offered 25 per cent stake each in the Bokaro and North Karanpura blocks.
The company also offered it a 10 per cent stake in the Ranigunj block. Listed in Australia, Dart is focussed on developing unconventional gas in the UK, Europe, India, China, Indonesia and Australia. The company is exploring CBM in two blocks in India.
The AIM-listed Great Eastern Energy Corporation Ltd (GEECL) was offered a 25 per cent stake for the Ranigunj block. The Delhi-headquartered company has been producing CBM from the adjacent Ranigunj (South) block in West Bengal since 2007.
Ahmedabad-based Deep Industries and a consortium led by Jindal Petroleum (a JSPL group company) were offered a 10 per cent stake each, in North Karanpura and Bokaro blocks, respectively.
Paras Savla, Chairman of Deep Industries, confirmed receiving an offer from ONGC in this regard.
“We have been offered 10 per cent stake in North Karanpura. We understand this is a good asset,” Savla told Business Line . Deep is exploring methane in two blocks — Singrauli in Madhya Pradesh and Godavari Valley (North) in Andhra Pradesh as part of a consortium with US-based Coal Gas Mart. The US-based company holds 10 per cent operating interest in both the blocks.
Confirmation was not available from Dart, GEECL and Jindal.
Background
Acquired more than a decade ago, ONGC has so far spent nearly Rs 600 crore in developing the four assets.
The bulk amount was spent developing the Jharia block. In return, the company was able to produce a mere 10,000-15,000 standard cubic metres of gas a day from one well in Jharia.
Its proposal, to rope in partners to recover its costs and ensure CBM development has hit one bureaucratic hurdle after another since 2008.
The last attempt was given up as early as in August 2012, when the Ministry of Petroleum and Natural Gas blocked a board decision to shed stakes in the CBM assets.
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