November 22, 2008

ONGC begins work on North Tapti field

It is reported that oil and Natural Gas Corporation Ltd has begun work on the project to develop the offshore North Tapti field in the western region. The project, which is estimated to cost INR 580 crore is expected to be completed by 2011.

According to company officials, the project appraisal committee recommended the project stating that it would be viable at a gas price of USD 4.75 per mmbtu even after sensitivity analysis. The feasibility report of the project has also been approved by Deloitte & Touche.

The officials informed that the viability analysis had been carried out considering a gas price of USD 4.75 per mmbtu, a discount rate of 12% escalation in operating cost of 8% and capital cost of 6% and abandonment cost at 20% of capital cost.

The North Tapti field falls in the Western Offshore basin, 237 kilometer west-north-west of Mumbai city and 45 kilometer west of Hazira, Gujarat. The discovery wells, Cl-2A, C1-3 and C 1-4, produced gas from two major gas sands, the Mahim and Daman formations. The gas volume is about 6.13 bcm and represents approximately 90 per cent of total gas in North Tapti. Cairn Energy India Ltd is the operator in the nearby CB/OS-2 block in which ONGC is a partner with 50% participating interest.