Oil and Natural Gas Corporation (ONGC) has started first crude oil production from its Cluster-2 deep-sea project in the Krishna-Godavari (KG) basin in the Bay of Bengal.
Petroleum basin in India
- A petroleum basin includes a diverse collection of rocks and sediments, but most importantly it contains source rocks.
- Source rocks are specific shale formations in a basin where oil and gas are born.
- There are 26 sedimentary basins in India, covering a total area of 3.4 million square kilometer.
- ONGC is India’s largest oil and gas producer contributing 72% of the country’s hydrocarbon production.
The Directorate General of Hydrocarbons (DGH) was formed to promote sound management of the oil and natural gas resources.
Oil and gas Market of India
- 3rd largest energy and oil consumer in the World
- 33% share of Oil and gas in India’s primary energy
- 85.7% was the import dependency of oil while for natural gas it was 48.2%.
Significance of Indigenous Petroleum Exploration and Production
- Reduction in import bill: As India imports about 85% of its crude oil requirement, indigenous petroleum production will reduce trade deficit.
- Strategic Importance: Reduces vulnerability to geopolitical uncertainties, supply disruptions, and price fluctuations in the global market.
- Revenue generation: Indigenous petroleum production contributes to government exchequer through taxes, royalties, and profit-sharing agreements.
- Employment Generation Jobs across a range of activities, including exploration, production, refining, and distribution.
About HELP
- HELP introduced in 2016, replaced New Exploration Licensing Policy (NELP).
- Provides for a Single license for E&P for all types of hydrocarbons viz. conventional oil and gas, CBM, shale oil, gas hydrates, etc.
- Shifted from the previous profit-sharing model to a Revenue Sharing Contract model (i.e., revenue is shared between the government and the contractor).
- In the profit-sharing model, the profit was shared after cost recovery.
- OALP was introduced to enable investors to select blocks of their choice by evaluating data in the NDR and expressing interest.
- Reduced royalty rates, marketing and pricing freedom, round-the-year bidding, etc.
Unconventional Petroleum Resources
- Oil and natural gas trapped in less permeable rocks is referred to as an unconventional resource because it cannot be explored, developed and produced by conventional processes.
- “Conventional resources” is a term referring to oil and natural gas trapped in rock that is porous and permeable.
- The natural pressure of the underground rock formation allows oil and natural gas to flow freely up a petroleum well.
- “Conventional resources” is a term referring to oil and natural gas trapped in rock that is porous and permeable.
- These include deposits like:
- Coalbed Methane (CBM) or Coal Seam Gas (CSG): Refers to methane rich gas naturally in coal seams typically comprising 80% to 90% methane with lower proportions of ethane, propane, nitrogen, and carbon dioxide.
- Shale gas/oil: It is a form of natural gas/oil that remains unexpelled, unmigrated and entrapped within the pore space and fractures of a source rock (commonly, shale).
- The shale gas/oil is produced commercially when sufficient fracture conductivity is induced by hydraulic fracturing.
- Gas hydrates: These are naturally occurring ice-like solids in which water molecules trap gas molecules in deep-sea sediments and in and below the permafrost soils of the polar regions.
