Petroleum Industry Current Affairs
State owned Oil and Natural Gas Corporation Limited (ONGC) has received environmental clearance for a project in the Krishna-Godavari (KG) basin in Andhra Pradesh.
Under this clearance, ONGC project has been allowed to drill 45 development wells and other related infrastructure will cost over 53,000 crore rupees at offshore KG-DWN-98/2 block.
- ONGC also has been asked to obtain Coastal Regulation Zone (CRZ) clearance, approval from Directorate General of Shipping (DGS) for commencement of drilling.
- It also has been asked to comply with all recommendations and conditions specified by Andhra Pradesh Coastal Zone Management Authority.
- KG-DWN-98/2 block is located within 25-80 km from nearest coast and covers an area of 7,294.6 sq km.
- Drilling in this block is expected to produce 51.33 billion cubic meters (bcm) of gas over a period of 16 years and 26.71 million cubic meters (mcm) of oil in 12 years.
- ONGC’s is going to drill 45 development wells in this block and also set up a FPSO (Floating Production Storage and Offloading) facility.
- It will also set up subsea production systems, offshore fixed platform and subsea pipelines connecting landfall point to existing onshore terminal of GAIL India Ltd.
India’s biggest state owned gas importer Petronet LNG has signed a revised contract with RasGas of Qatar to import gas at a significantly lower price than earlier.
Under the new contract, Rasgas will supply Liquefied Natural Gas (LNG) to Petronet at 6-7 dollar per million British thermal units (mmBtu) from January 1, 2016. It would supply to 7.5 million tonnes of LNG India until the long-term contract ending in April 2028
The new rate is sharply lower than 12-13 dollar per mmbtu agreed earlier and has been revised after falling global prices of oil and gas, saving consumers around Rs.4,000 crore.
The new price formula between the two companies is a win-win situation for both countries. It also marks Union Government’s biggest diplomatic win to leverage India’s position as one of the world’s biggest energy consumers by striking better price bargains for its companies.
It also indicates that tumbling oil prices and a global gas glut due to overproduction and fall in demand due to global economic slowdown are compelling exporters especially OPEC countries to offer better deals to retain their share in global energy trade.