ONGC to invest Rs 1.6 lakh cr in 5 yrs

AHMEDABAD: Oil & Natural Gas Corporation (ONGC) plans to invest Rs 1,60,000 crore over the next five years. The government has approved the budget, which will be spread over the XIth Plan period.

AK Hazarika, director (onshore), told ET out of this, about Rs 29,000 crore will be spent on exploration. Capital expenditure worth around Rs 11,000 crore will be undertaken each year.

ONGC also proposes to invest about Rs 5,000 crore every year in ONGC Videsh (OVL). As major crude oil finds are not possible in India, ONGC is focusing on acquiring oil assets globally. While the government had set OVL a target to get 20 million tpa of oil from outside by 2020, it now wants this to be achieved by 2012. “

This is a very difficult target, but we will try to meet it,” said Mr Hazarika. OVL has started producing 4 million tpa of oil, with 3 million coming from Sudan block. OVL has 25 properties spread across 14 countries.

Against the target set for sourcing oil from abroad, the target for domestic production is marginally higher at 141 million tonnes for the XIth Plan period, which works out to around 28 million tonnes a year. ONGC’s production stands at 26 million tpa, with nearly two-thirds contributed by the Mumbai High offshore and on-shore fields.

Mr Hazarika said that OVL’s primary focus is to acquire oil assets globally. But on the gas front too, ONGC is looking at tapping the domestic markets where large finds have been made in the last few years.

“We have set a target of generating 4.2 billion cubic metres of gas from the CBM blocks and through coal-gassification process,” he said. Out of the nine CBM blocks that ONGC has bagged, it has given contract for three blocks in Jharkhand to drill them. He said that while Gujarat State Petroleum Corp and Reliance Industries have made big gas finds in the KG Basin, ONGC has been unlucky so far and has not found anything big.