Border Tensions Hit ONGC’s Exploration Work In J&K

Border Tensions Hit ONGC’s Exploration Work In J&K

4 January 2010
The Economic Times


New Delhi: India is unable to explore oil & gas assets near the north-west border areas due to tensions with Pakistan. Security concerns and continuous firings from across the border has prevented exploratory drilling by the state-owned oil explorer Oil & Natural Gas Corporation (ONGC) in Poonch and Riasi districts of Jammu & Kashmir, regions with high hydrocarbon potential, an official in the government said. ONGC has intensified its exploration activities in the country, particularly in J&K and north-eastern states, to augment production of oil and gas. The company’s existing oil fields are old and the production is beginning to plateau or even decline. “ONGC is unable to undertake exploration & production in Poonch and Riasi as the operational area lies too close to the line of control (LoC) and has also been declared environmentally sensitive,” the official said requesting anonymity. This delay could prove costly as recent exploratory work in the state has shown potential of gas in the Karewa basin and oil has also been reported from asphaltic limestone at Satranala areas in the Himalayan foothill basin, the official added. ONGC has not made any major discovery in the last 30 years after the Mumbai High. MOL Plc, a Hungarian exploration company, which has already made two oil and gas discoveries in Pakistan in similar geological conditions, could be an important ally for exploration activities in the Himalayan region, a technical expert in the ministry said requesting anonymity. In 2008, ONGC had signed a memorandum of understanding with MOL for a broad co-operation in exploration projects in India and other countries besides providing E&P technology to the company. Later, MOL also picked up 35 per cent stake in an exploration block (HFONN-2001-1) in Himachal Pradesh from ONGC. The block was awarded to ONGC in the third round of new exploration licensing policy (Nelp-III). J&K has three basins-Spiti-Zanskar and Karewa in Kashmir Valley, and Himalayan Foothills-that are important for oil and gas exploration. ONGC has been carrying out geological and geo-physical surveys in phases in the state since 1957 but without much success. The company has now acquired new seismic data for these basins and has also drilled four exploratory wells recently that have shown potential. Domestic crude oil production declined 1.2 per cent in the April-September 2009 over the corresponding period a year ago due to fall in output by ONGC, a report of Centre for Monitoring India Economy (CMIE) said.


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