India-based Oil and Natural Gas Corporation (ONGC) is planning to invest about $5bn in its east coast oil and gas asset over the next few years in order to boost production.
The investment plan, which has been approved by the board, is focused on developing and bringing on-stream ten oil and gas discoveries in KG-DWN-98/2 block (KG-D5) in Krishna-Godavari basin off the east coast of India.
Press Trust of India cited ONGC chairman and managing director Sarraf as saying: "First gas production is envisaged by June 2019 and oil would start flowing from March 2020.
"This is the biggest ever financial decision taken by ONGC in its history."
The KG-D5 block, which is divided into the northern discovery area (NDA) and southern discovery area (SDA), comprises three clusters.
The Cluster II, which comprises two fields Cluster 2A and Cluster 2B, is estimated to have recoverable reserves of 50 billion cubic meters of gas and 23 million tons of crude oil.
The latest announcement follows the government’s approval for the Hydrocarbon Exploration and Licensing Policy (HELP), which allows marketing and pricing freedom for the crude oil and natural gas produced.
Sarraf was reported by Livemint as saying: "Within three weeks of the government announcing the new gas pricing policy, we were able to process everything and the board of directors could make the investment decision."
Image: The Cluster II of KG-D5 block is estimated to have recoverable reserves of 50 billion cubic meters of gas and 23 million tons of crude oil. Photo: courtesy of think4photop/FreeDigitalPhotos.net.