ONGC starts modernizing the Panna-Mukta field to reduce costs and increase production
NEW DELHI: ONGC modernization of the Panna-Mukta field has begun with the objective of reducing costs and increasing production after regaining full control of the block more than 25 years after discovering it on the coast of Mumbai.
The twin fields reverted to ONGC last month after the 25-year government contract, originally signed with a consortium of US major Enron and Reliance Industries, for the block expired on December 21. One of the first actions taken by state-run company was to scrap the costly shipping contract with Mercator and give it to public sector Shipping Corporation of India, resulting in a saving of $ 5,000 per day.
The ships, which act as floating storage, fill up the oil from the field and transport it to the shore for processing before being pumped into the pipeline network. ONGC has hired a Shipping Corporation ship for 18 months, by which time it expects to lay an undersea pipeline to carry crude to the shore. This will offer a safer and more economical mode for evacuating higher output. The fields produces about 10,000 barrels of oil per day and 4 million cubic meters per day of natural gas. The sources said there is good scope for ramping up production, especially of gas.
ONGC had discovered the Panna-Mukta and Tapti (PMT) oil and gas fields in the early 1990s. But the fields were taken away from the company and awarded to a consortium of now-bankrupt US energy major Enron and Reliance Industries, with 30% stake each. ONGC was given 40% as the government nominee. In 2003, BG took over Enron during its bancruptcy proceedings In 2016, Shell took over the BG Group’s interest.