ONGC partners BP subsidiary as technical services provider to boost output from Western Offshore Fields
New Delhi, May 25
State-owned Oil and Natural Gas Corporation has entered into a contract with BP Exploration Services India Limited as the Technical Services Provider for its entire Western Offshore assets in a major move aimed at enhancing production, arresting output decline, and strengthening India's domestic energy security.
The contract has been awarded after ONGC issued an International Competitive Bidding (ICB) tender to improve output from ageing offshore fields in the Mumbai Offshore Basin, following its earlier TSP engagement in the Mumbai High field, which is the largest oil field in the basin and accounts for around 38 per cent of Western Offshore production.
The earlier Mumbai High TSP arrangement had shown early signs of stabilising production decline through focused Well, Reservoir and Facility Management (WRFM), optimisation of existing wells, enhanced surveillance and de-bottlenecking of facilities, encouraging ONGC to extend the model to other mature offshore assets.
Under the new agreement, BPXS will review field performance across reservoirs, wells and facilities in the Western Offshore region and identify interventions to enhance hydrocarbon recovery. The Mumbai Offshore Basin, which consists of 43 blocks with a mix of nomination and auctioned regimes, has been under continuous development for over four decades and remains a key contributor to India's domestic oil and gas production.
The TSP is expected to deploy global best practices and technology-driven solutions to extract additional output from ageing fields, which ONGC sees as essential alongside new exploration efforts to meet rising energy demand.
As part of the contract, BPXS has projected a potential increase of about 10.8 per cent in crude oil production from 46.25 MMT to 51.26 MMT and a 31.5 per cent rise in natural gas output from 82.68 BCM to 108.69 BCM over ten years. Overall hydrocarbon output is expected to rise by about 24.1 per cent, with visible gains likely from FY27 and full impact expected by FY30.
The contract structure includes a fixed fee for the initial two years, followed by a performance-linked service fee based on revenue from incremental production after cost recovery.
With this move, ONGC aims to replicate the efficiency gains achieved in Mumbai High across its wider Western Offshore portfolio to maximise recovery from mature fields and strengthen domestic energy security.
— ANI
Reader Comments
Glad to see India leveraging global expertise for energy security. The projected 10.8% oil & 31.5% gas boost over 10 years is significant. But I hope the performance-linked fee structure ensures value for money and doesn't become a costly experiment.
Finally, some pragmatism! Mature fields need global best practices. But let's see if BPXS delivers on these projections. ONGC's own record on enhancing recovery has been mixed. Also, why is the full impact only by FY30? We need faster action given the energy crisis. 🤔
Another foreign company gets a contract while Indian firms sit out? I understand the need for technology, but we should also be building indigenous capabilities. At least the performance-linked fee is good - it ties payments to results. Let's hope they meet the 24.1% overall increase target.
Smart strategy by ONGC. The Western Offshore fields are complex and ageing - using a TSP like BP that has deepwater and mature field experience makes sense. The 10-year timeline is realistic for such technical interventions. India needs all the domestic production it can get. 🛢️👍
I'm cautiously optimistic. The Mumbai High TSP showed promise, so replicating it makes sense. But I worry about the fixed fee for first two years - that's a lot of money upfront. And will BP really share technology or just apply their standard solutions? Need transparency on KPIs.
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