ONGC and BG India Strengthen Relationship
By ONGC and BG Exploration | 02 Dec 2005
ONGC and BG Exploration and Production India Ltd (BGEPIL) will jointly operate three offshore deepwater exploration blocks on the east coast of India.
The blocks, KG-OS-DW III, KG-OS-DW and KG-OS-DW, are located in the Krishna Godavari Basin, and in the vicinity of several blocks in which there have been recent discoveries. These three blocks cover an area of 3,090 square kilometres.
Subject to agreeing farm-in arrangements and government approval, BGEPIL and ONGC will each own a 50-per cent interest in these blocks.
The deepwater exploration blocks were assigned to ONGC on a nomination basis and on under the terms of the new exploration (NELP) policy terms for exploration and development in partnership with a global major oil and gas company. ONGC had marketed these blocks during NELP-V with the ministry of petroleum and natural gas.
BGEPIL has agreed to pay a $5-million up-front payment for each block upon receipt of government approval of the farm-in, and additional payments will be made towards exploration costs as well as a payment made upon discovery.
ONGC and BG India have also agreed to explore other mutually beneficial opportunities in India and overseas.
Announcing the agreement at the World Oil & Gas Assembly in Jaipur, Subir Raha, chairman and managing director of ONGC said, "ONGC is happy to welcome BG, after Cairn and Eni, as joint operator in these exploration blocks. We are happy that the joint operatorship framework promoted by ONGC in the Panna, Mukta and Tapti producing fields has generated the confidence for such a partnership in India and abroad."
BGEPIL and ONGC are partners with Reliance Industries in the offshore Panna / Mukta and Tapti joint venture on the west coast of Mumbai.