ONGC Sees Oil Output Rising 11% in 3 Years: Report

New Delhi: After arresting a seven-year decline in crude oil production, state-owned Oil & Natural Gas Corporation (ONGC) will see an 11 per cent rise in output over the next three years as it brings newer fields in production.

ONGC had in fiscal year 2014-15 broken a seven-year jinx of dipping crude oil production by recording a marginal rise in output to 22.262 million tonnes, from 22.247 million tonnes in the previous year.

"We are investing heavily in marginal field developments, results of which have started to accrue. This year, our crude oil production is likely to be 24 million tonnes," a senior company official said.

In fiscal year 2016-17, the output will further rise to 24.80 million tonnes and 24.81 million tonnes in the following year.

The company had produced 23.71 million tonnes of crude oil in 2011-12, which declined to 22.56 million tonnes in the following year.

ONGC's fields are as old as 50 years. Its prime Mumbai High, which accounts for nearly 60 per cent of its oil production, is 40 years old.

"The fields are off their peak. Mumbai High field, which had touched a peak of 20.574 million tonnes in 1989-90, has dipped to 9.211 million tonnes in 2014-15," he said, adding that the company's focus on developing small and marginal fields is now paying off.

The increase in output will primarily come from offshore fields, particularly off the west coast. In FY15, offshore production had risen to 14.74 million tonnes from 13.71 million tonnes a year ago.

The official said natural gas production will see a steeper rise - from 64 million standard cubic meters per day output in 2014-15 to 66 mmscmd in the current fiscal year (2015-16) and to 102 mmscmd in 2018-19.

"We have a series of gas fields that will come into production between now and 2018-19. As a result, the production will rise to 73 mmscmd in 2016-17, to 87 mmscmd in 2017-18 and finally to 102 mmscmd in 2018-19," he said.

The official said ONGC is investing Rs 24,188 crore in six major field developments and another Rs 17,490 crore in redevelopment of three currently producing fields including Mumbai High and Heera fields.

These investments do not include the over $8 billion that the company is planning to spend on the Krishna Godavari basin gas block of KG-DWN-98/2 or KG-D5.

"KG block investment has not yet been approved by the board. The others are all sanctioned investments," he said, adding that KG-D5 is likely to begin producing oil and gas from 2018-19.