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State-owned ONGC’s nine biggest oil and gas fields, including Mumbai High and Vasai East, came tantalisingly close to being sold to private and foreign companies, but the plan was nixed after strong opposition from within the government, sources said.
A high-level committee headed by NITI-Aayog Vice-Chariman Rajiv Kumar late last year had considered “transferring” western offshore oil and gas fields of Mumbai High, Heera, D-1, Vasai East and Panna as well as Greater Jorajan and Geleki field in Assam, Baghewala in Rajasthan and Kalol oilfield in Gujarat to private/foreign companies. Multiple sources in NITI-Aayog and government said the plan to give away fields producing 95 per cent of India’s current oil and gas could not go through because of very strong opposition from Oil and Natural Gas Corp (ONGC) as well as some quarters within the government who found something amiss in the proposal.
Besides the nine fields, 149 marginal fields that contribute about 5 per cent of the domestic production were to be clustered and bid out.
The proposal brought before the panel, which was appointed by Prime Minister Narendra Modi in October last year to boost stagnant output from ageing fields of public sector oil companies, was to give private/foreign companies complete marketing and pricing freedom after getting from them an enhanced production profile for the fields.
National oil companies (NOCs) were to get 10 per cent of incremental output over business as usual (BAU) scenario, sources said.
Private and foreign companies have generally shied away from taking up exploration blocks and have instead been lobbying for getting a stake in producing oil and gas fields of ONGC and Oil India Ltd (OIL) saying they can raise output by bringing in capital and technology.
NOCs, on the other hand, contend that they do not have pricing and marketing freedom and they too can get the technology .
The final report that the committee submitted on January 29, had watered down the proposal by recommending freedom to NOCs to choose field specific implementation model including farm out, joint venture or technical service model for raising output from the fields that contribute 95 per cent of the current output. Pricing and marketing freedom for any new field development plan that they bring was also recommended.
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