Aiming to enhance domestic production of oil and gas, India is expected to conclude the Open Acreage Licensing Programme (OALP)-IX bidding round and open the OALP-X round in 2024 calendar year, Wood Mackenzie (WoodMac) said.

However, the energy research and consulting major is “sceptical” whether the exercise will lead to big acquisitions, even as oil and gas majors evince interest in exploration and production (E&P).

“In 2024, India will conclude OALP-IX and kick off its OALP-X offering. These two rounds offer large concessions in offshore that were previously no-go areas for oil and gas exploration. The majors have shown lots of interest, but we remain sceptical this will turn into big acreage acquisitions,” WoodMac said in its latest report on the Asia Pacific upstream sector.

Asia Pacific’s upstream future is focused on gas. And 2024 will be another year in which operators, regulators and governments intensify their pursuit of new sources of gas, it added.

WoodMac anticipates a rise in exploration activity in South-East and Southern Asia, which will be driven primarily by licensing activity and aggressive national oil company (NOC)-led drilling programmes.

OALP bids

Earlier this month, Oil Minister H S Puri launched the OALP-IX bid round in which 28 blocks spread over eight sedimentary basins with an area of around 1.37 lakh sq km have been offered for bidding. The bid submission opened on January 3 and the last date for submitting bids is February 28, 2024.

Under the OALP-IX bidding round, nine blocks are Onland, shallow water blocks (8) and eleven ultra deep water Blocks have been offered.

While 16 oil and gas blocks are Category-I, the remaining 12 blocks are Category-II basins. Basins which have proven hydrocarbon resources with established commercial production are Category-I basins, whereas Category-II are basins with contingent resources that are yet to be converted to recoverable reserves and commercial production.

In the recently-concluded OALP VIII bid round, Oil and Natural Gas Corporation secured 7 blocks. Besides, Oil India (OIL), a consortium of Reliance Industries (RIL) and BP as well as Sun Petrochemicals secured one block each.

After the award of 10 blocks under OALP Round-VIII, so far a total of 144 exploratory blocks have been awarded under the HELP regime covering an area of 2,42,055 sq km since 2017.

Deepwater exploration

“Deepwater exploration in India is gaining momentum, notably in the Krishna-Godavari basin where Reliance and ONGC are planning to drill multiple wells in 2024,” WoodMac said.

Last week, ONGC announced the successful commencement of “First Oil” from the deep-water KG-DWN-98/2 Block, situated off the coast of Bay of Bengal. It is likely to increase the company’s total oil and gas production by 11 per cent and 15 per cent, respectively.

The E&P major is the operator of the block KG-DWN-98/2, which consists of three clusters of discoveries—Cluster-I, II & III.

Last month, Minister of State for Petroleum & Natural Gas Rameswar Teli said in Parliament that in cluster-III, there is one ultra-deep water gas discovery which would be the second deepest hydrocarbon discovery in the world, when monetised. The field development plan (FDP) is scheduled to be submitted by January 2026.

RIL in its annual report for FY23 said key focus of the E&P business has been safe and reliable operations and project delivery while maximising production from the deepwater fields.

Production has been ramped up to 20 million standard cubic metres per day (MSCMD) from the R & Satellite Cluster fields, it added.

With the commissioning of the MJ field in Q1 FY24, the KG D6 block will produce around 1 billion cubic feet equivalent per day (BCFe/day) by FY24, thereby contributing about 30 per cent of India’s gas production.