State-run ONGC may rope in Essar Oil as a collaborator to develop four CBM (coal-bed methane) fields in Bengal and Jharkhand, according to sources.

ONGC pioneered CBM development in the country in the 1990s. However, with a minuscule 10,000-15,000 standard cubic metre a day (scmd) production it is also the biggest failure, dragging down the industry performance. The company acquired nine blocks through bidding. Five were relinquished after years of exploration.

An attempt to rope in strategic partners for four blocks, through a complex deal in 2013 remained unsuccessful.

Essar, on the other hand, is the biggest success story in the Indian CBM industry with production from Ranigunj (East) block now at 1.2 million standard cubic metre gas everyday (mscmd) and is confident to touch the targeted 2.8 mscmd mark next year.

Essar is the first company to cross the 1-mscmd mark.

Its nearest competitor, Great Eastern Energy Corporation Ltd (GEECL), which set up CBM production from neighbouring Ranigunj (South) block in 2007, is barely halfway there.

Sources say ONGC is now keen to replicate Essar’s success story in Ranigunj, North Karanpura, Bokaro and the only producing asset of Jharia.

State-owned Coal India has participatory interest in Jharia and Ranigunj blocks.

While the nature of the collaboration is not known, sources say active negotiation is on between the companies.

The primary focus is to use Essar’s proven technical expertise in turning the ONGC fields productive.

Essar and ONGC officials refused to comment on the issue.