chapter - i oil and natural gas commission (ongc...
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CHAPTER - I
OIL AND NATURAL GAS COMMISSION (ONGC) ORGANIZATION AND WORKING
CHAPTER - I
OIL AND NATURAL GAS COMMISSION (ONGC) -ORGANISATION AND WORKING
INTRODUCTION:
The Oil and Natural Gas Commission (ONGC) is the
premier state owned oil enterprise which is mainly responsible
for exploration development and production of hydrocarbon
resources in India. ONGC was found in 1956 as a Directorate in
the Ministry of Natural Resources & Scientific Research and was
upgraded to Oil & Natural Gas Commission - statutory body - by
an act of time, the commission has assimilated world's finest
petroleum expertise and operates along the lines of renowned
international petroleum companies in the world. It is one of
the few oil companies of the world engaged in every aspect of
oil exploration and exploitation in the most diverse geographi
cal conditions. Recently, the ONGC has become a limited company
under the Companies Act 1958. In view of its vast potential,
this chapter is devoted to analyse the structure working and
role of ONGC in the production and distribution of oil.
STRUCTURE AND ROLE:
ONGC has complet in-house capability, high degree of
expertise, professional experience and necessary ini'ra-
structure to undertake exploration ventures, job contracts and
consultancy services, singly or jointly in India as well as
abroad..ONGC has the unique distinction amongst the developing
nations to diversify its activities and assist other friendly
countries in their programmes of hydrocarbon exploration and
exploitation. In f act,. ONGC has successfully undertaken various
types of consultancy services for National oil companies of
Iran, Iraq, Abu Dhabi, Sri Lanka, Tanzania etc. In addition
ONGC has well equipped institutes for conducting advanced level
research & development in the field of hydrocarbons and also
for imparting training to Indian as well as foreign nationals.
ONGC, for better managerial accountability & profitability, has
grouped its entire activities into two major subdivisions, viz.
functional & supporting. The functional group has been further
studies into exploration, drilling operations & technical
supporting groups are personnel and finance.
ONGC's multi dimentional and multi environmental
experience has led to the development of distructive capabi
lities and skills. ONGC undertakes geological, geophysical and
geochemical surveys, wild cat drilling, prospect analysis
formation evaluation, biostratigraphir analysis, geochemical
studies, basin evaluation, estimation of geological and
recoverable reserves, reservior modelling, application of
secondary recovery & EOR techniques to increase the recoverable
1. ONGC Videsh Limited, Exploratidn & Exploitation of Hydt-ocarbons, 1989, New Delhi.
reserves & production preparation and monitoring of development
schemes, repairing of sick wells stimulation techniques, long
distance transportation of oil & gas (both onshore and
offshore) production of L.P.G. from natural gas, erection and
maintenance of sweeting plant for treating sour gas and
training of manpower, application of computer in petroleum
industry. Today equipments of considerable value are owned and
operated by ONGC including seismic vessels, drilling ships,
jackup rigs, multipurpose support vessels, helicopters and
L.R.G. plant among others. It has also encouraged indigenous
enterprises to manufacture the equipments needed for its
operation like well platforms, process platforms, onshore
drilling rigs, pumps and compressors etc.
ONGC operates its own 85 onshore drilling rigs, nine
offshore drilling vessels, a number of conventional analog and
digital open hole logging units, workover rigs, drill stem
testing (DST) and mud logging units. ONGC's exploratory and
production wells are drilled under the close supervision of its
petroleum engineers, geologists and drilling engineers in a
cost effective manner. ONGC has got varied experience of
drilling under different geological/geographical domains like
highly dipping areas, high temperature and high pressure zone,
structurally complicated areas, hilly terrain, deserts sand
dunes,'marshy land and shallow to deep waters (upto 400 mts.
water depth) and shallow to super deep depths upto 6 kms.
ONGC has developed techniques for the formulation of
completion fluids for any formation, selection of packer
fluids, perforation techniques and for whole and surface well
completion equipment design. It has developed expertise in
assessment of fracture pressures and in establishing appro
priate pressure control. Also ONGC has extensive experience in
directional drilling (including horizontal drilling) and drill
stem testing. ONGC has to its credit the discovery and
production of hydrocarbons from a wide range of conventional
and unconventional reservoirs right from the antidines, fault
closers to stratigraphic traps to fractured besement. It
produces hydrocarbons from shallow depths to deeper depths.
ONGC has put some of its fields on dual completion i.e.
producing hydrocarbon simultaneously from two different pay
zones. ONGC had developed capabilities and accumulated rich
experience in conventional as well as complex facets of
production, reservoir and chemical engineering, including oil
and gas field gathering systems, oil, water and gas processing,
workovers, completion procedures, artificial lift and all
primary, secondary and tertiary recovery techniques.
OBJECTIVES OF OIL & NATURAL GAS COMMISSION (ONGC):
1. To promote self-sufficiency in crude oil and
natural gas.
2. To promote self-reliance in technology.
3. To assist in conservation of oil more efficient
use of Energy and Development of alternate sources
of Energy.
4. To make regular efforts for new exploration areas.
5. Promoting, indigenous efforts in oil related
equipment and services.
6. To make long term planning for oil sufficiency.
7. Obtaining its share in the world oil market.
8. To achieve maximization of the rate of return on
investment.
9. To build up relevant technology and techniques,
in oil exploration practices.
10. Generation and maximisation of internal financial
resources, for its own growth and development.
11. Environment protection.
ORGANIZATION:
An individual is unable to fulfill his needs and
desires alone because he has limited strength, ability, time
and potentials. So he seeks the cooperation of other persons
who have certain common interests. This gives birth to an
organization.
1. Singh, B.P. & Chabbra, T.N., Fundamental of Business Organization, 1981, p.112.
Generally, the term 'organization' means an organi
zation structure which consists of the (1) division of labour
and division of activities, (2) determination of responsi
bilities, (3) delegation of authorty, (4) coordination of
different activities, (5) effective communication and
flexibility.
Yodder has mentioned that from ancient to modern times,
rulers, owners and managers have always organized their
resources. In the process they have created organizational
structures, some small and simple, other large and complex.
In industrial societies, work takes place largely in complex
working organizations which combine the contribution of dozens,
hundreds or thousands or workers.
Organization is the process of identifying and grouping
the work to be performed defining and delgating responsibility
and authority and establishing relationships for the purpose of
enabling people to work most efficiently together in accomp-2
lishing objectives. Organization generally, means a form of
human association for the achievement' of common goals.
Organization structure has been playing a very Important role
in every walk of life. Good management, tlierefore, alw.ivs
1. Dale Yodder, Theories of Organization, Personnel Management and Industrial Relations, Prentice Hall of India, New Delhi, 1972, p. 94.
2. Allen, Louis, A. Management and Organization, New York, McGraw Hill, 1958, p. 57.
concentrates on organization and directing the cooperative
efforts- of human beings so as to achieve the best possible
results .
Organization is a basic function of management. By
performing this function, the management brings together the
human and non-human resources to form a manageable unit. Such a
unit taken as a whole is identified as an organisation.
Organisation helps in planning, stuffing, directing and
controlling. Organisation may be described as the backbone of
management. Without efficient organization no management can
perform its functions smoothly.
Organization as a function of management involves
identification and grouping the activities to be performed and
dividing them among the individuals and creating authority and
responsibility relationships among them.
Organization has been defined in many ways. Some
authors have defined organization in a general and wider sense.
According to Henri Fayal , "To organise a business is to provide
it with evpry thing useful to its functioning raw materials,
tools, capital and personnel." According to Barnard, "An
organisation comes into existence when there are a number of
persons in communication and relationship to each other and are
willing to contribute towards a common endeavour."
1. Singh, B.P., Fundamentals of Business Organisation, p.112.
2. Singh, B.P. & Chhabra, T.N., Ibid., 1981, pp.111-12.
8
ORGANIZATIONAL STRUCTURE:
The word 'organisation' is also used in the sense of a
structure of relationship. These relationships are among
various positions and jobs in the organization. The concept of
organisation structure is somewhat abstract and illusive. In a
simple sense, organisation structure means the predetermined
patter of relationship among various components or parts of the
organisation structure prescribes the relationship between
various positions, activities, authority and the responsibility
compared on each organisation structure is the basis of the
enterprise. Structure in modern organisation is designed even
before people are appointed to fill various positions in it.
Organisation structure is a pictorial representation of
the physical constitution of the business. This consists of
structure of relationships, responsibilities and authorities
through which a business can achieve its objectives. to
achieve the objectives of the enterprises it is necessary to
assign duties and responsibilities to every individuals or
group of men comprising the organisation and control and
coordinate the various activities. A pattern of relationship
amongst these groups and individuals in the group has to be
established for integrating and coordinating their activities
in perfect harmony. Organisation can be defined as a process of
establishing the pattern of relationship by assigning duties
and responsibilities to each department, section, group and
individual of an enterprises, clearly demarcating, the
authority, responsibility and duties of each and providing the
channel of communication and coordination to achieve the
objective of the concern.
Strauss and Sayles have defined organisational
structure as more than a series of inter-connected boxes and
2 lines on a chart. The organisation structure also comprises
the formal communication network of the business through which
decision and instructions flow downwards and reports flow
upwards as feedback for managerial control. There are so many
types of organisational structure viz. functional types, line
types, line and staff types and matrix structure.
We talk of the organisation structure of a certain
business as though it were something which exist of its own
right but in fact what we really mean is no more than a certain
pattern of responsibilities, in other words, a framework within
which, and by means of which, the process of management can be
carried out. Organisation structure is therefore the purpose of
helping along a certain process and thus is, in its essence, a
secondary thing. The structure of organisation of an enter
prises is the framework for carrying out the responsibilities
1. Dalta & Basu, Works Organisation & Management, Oxford IBH Publishing Co., New Delhi, p.
2. Strauss and Sayles, Personnel: The Human Problems of Management, Prentice Hall, New Delhi, 1968, p.365.
10
of management, for the delegation of such responsibilities, for
the. coordination of activities or operations, and for the
motivation of members.
Organisation structure has been playing a very
important role in every walk of life. Good management,
therefore, always concentrates on organisation and directing
the cooperation efforts of human beings so as to achieve the
best possible results. Organisation, in simple sense, means, a
form of human association for the achievement of common goals,
organisation is the mechanism through which management
functions and controls the enterprises. It is the backbone of
the management and without its proper care at higher, middle
and lower levels of administration, it would be very difficult
for management. It is the foundation of management. Development
of human resources determination and grouping of activities,
allocation of responsibilities and delegation of authority and
division of labour are possible through organisation which is
very important for the smooth running of enterprise as well as
society. Organisation lays the basis for other managerial
functions such as planning, coordinating, direction and
control.
1. Brech. Organisation. Hazell Watson and Vlney Ltd., 1957, p.10.
11
ONGC ORGANIZATIONAL STRUCTURE:
The Oil and Natural Gas Commission (ONGC) was formed on
October 15, 1959 under an act of Parliament to take over the
activities of the Oil & Natural Gas Directorate set up by the
Government of India of 1956.
In 1955, the Government of India decided to undertake
exploration and development of Oil and Natural Gas resources in
the various regions of the country in the public sector. An Oil
& Natural Gas Directorate was, therefore, set up towards the
end of 1955, as a subordinate office under the then Ministry of 2
Natural Resources and Scientific Research.
Soon after the formation of Oil & Natural Gas
Directorate, it became apparent that it would not be possible
for the Directorate, with the limited financial and adminis
trative powers, as a subordinate office of the Government to
function efficiently in its task of oil exploration and
production. To overcome this difficulty in August 1956, the
Directorate was reconstituted as the 'Oil & Natural Gas
Commission' with enhanced powers, although it continued to be a
subordinate office of the Government. In October 1959, the
ONGC Hand Book, Institute of Management Development, Dehradun, p.. 1.1
Personnel Policy Hand Book, Dehradun, 1989, p.5.
12
Oil & Natural Gas Commission was converted, into a statutory
body, by an Act of Parliament, which enhanced the powers of the
commission still further.
It's corporate structure consists of a chairman and not
less than two and not more than eight other members appointed
by the Central Government. One of the Members is a whole time
Finance Member incharge of its financial matters.
The commission is at present constituted of the
following:
(a) Chairman
(b) Vice-chairman & Member (Exploration)
(c) Member Drilling
(d) Member Technical
(e) Member Finance
(f) Member Personnel
(g) Member Natural Gas
(h) Two part-time Members representing 2
the Government of India.
ONGC began as a subordinate office of the Government of
India. It was headed by a part-time Chairman who was a Central
Government Minister. There were two members, Member (Technical)
1. Ibid., p.5.
2. ONGC Hand Book, Institute of Management Development, Dehradun, p. 1.1
13
and Member (Finance), two Directors, one for Geology and
another fo.r Geophysics, and an officers on special duty for
drilling and engineering service. As the activities of the
organisation expanded, a full time Chairman was appointed in
1965 that was when exploration was taking place on large areas
onshore and exploration extended into the shallow waters of the
Gulf of Camaby. The major organisational change took place in
2 1975 as suggested in the Malviya Committees Report. A major
change under this set up was the appointment of two exclusive
members for operation onshore and offshore. Overseas operation
was placed under the charge of a General Manager.
ONGC has been able to achieve such a great success in
making the country self-reliant, in fulfilling the petroleum
requirements of the country to a great extent in such a short
period of its operation. This success is partly a result of
ambitious men who are engaged in ONGC and their tireless
efforts, zeal in the production, and partly to sound
organization and administrative structure, which ensures quick
decision making and efficient planning ONGC is a public
corporation which is governed and managed by Parliament through
its executive and. related ministry by giving autonomus powers
in the hands of executive. The main source of planning is the
Twenty Five Years of ONGC, Publication Dehradun, 1956-1981, pp. 5-6.
Ibid.
14
Ministry of Petroleum and Chemicals which is headed by a
cabinet rank minister. He is assisted by a Deputy and a State
Minister each with his respective secretaries and Finance
Ministry. They take decisions and formulate the different
aspects of oil policy. Project the future requirements of
petroleum products in the country, formulate the budget as to
production'and plant about procurement of crude oil etc.
The position and roles of important organisation
members and the persons concerned are summarised below:
The Chairman is the chief decision making person for
all important matters like expansion, production, acquisition
of new platforms, personnel, finance, materials and
exploration. Member of Exploration dealing with all the
exploration activities through Director (KDMIPE), Director
(IRS) and General Manager (Exploration). There is a separate
personnel department to deal with employees of the organi
zation on personnel matters. The Members n£ Personnel is
assisted by Director (Administration; Director (CR) , Junior
Director, Delhi Office. The member of onshore performs all the
onshore activities like drilling, production etc. Under him
work Director (Operation Review), Director (Operation) Chief
Engineer (Civil). All the offshore activities are performed
under the supervision of member of offshore. Member offshore
is assisted by six persons. General Manager (Operation),
Director (Finance), General Manager (Production) Director
15
(Transport), General Manager (Engineering and Cc-.st ruction) ,
Director (Stores and Purchase).
Member Finance is the head of the Fin-i'-'cp '• •partment .
Three separate departments function under the sapc/vision of
Member Finance i.e. perspective planning cell, Director Finance
and Director (Offshore Accounts and Audits). The member of
materials deal with all important matters about the materials
like purchase and stores and so on. Inspection and Adminis
tration Director (TPT and Shipping), and Director (Stores and
Purchase) has functional relation to Member of Materials.
The whole project is divided into divisions and
departments. This include the area of Exploration, Drilling,
Engineering, Production, Finance, Stores and Personnel. Each of
these operating divisions and departments is headed by Special
Manager who is responsible for its performance. Ne« jnits ari
defined and functional designations created which are more
consistent with the responsibilities being assigned to the
staff. The basic organisation structure of the ONGC is
presented in the Fig. 1 and Fig. 2.
After having discuss the organisation chart of ONGC, we
have now to discuss the working of ONGC. Rapid industriali
zation and fast economic development of the country have make
it essential to explore indigenous resources before
independence oil was a myth in India. After the independence
in 1947, the growing need for petroleum products for
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18
industrialization and economic development was felt by Late
Pt. Jawahar Lai Nehru, the first Prime Minister of India and
Late K.D. Malviya ex-Petroleum Minister who developed a plan
for the search of oil in an organised manner.
At the time of independence the country produced only
0.2") million tonnes of oil per year from its field at Digboi in
Assam. More than 907„ of petroleum products requirements were
2 imported.
It was only in August 14, 1956 that the Oil and Natural
Gas Directorate under the Geological Survey of India was raised
to the status of a Commission which was made a statutory
organisation on 15th October 1959. Thus ONGC was formed to
accomplish the task of exploring, drilling, and producing Oil
and Natural Gas. At present the Headquarter of ONGC is located
in Dehradun. In addition, ONGC has regional offices in Bombay,
Baroda, Calcutta, Jammu, Madras, Nazira and some other work
cent'.tes in various other cities of India.
EXPLORATION:
The continuing increase in demand for oil as a major
source of energy for industry, transportation as well as other
1. The Economic Times, New Delhi, Nov. 14, 1989, p.6
2. Ibid.
3. Twenty Five Years of ONGC, op. cit., p.4.
19
sectors in India warrants the need to find and produce more oil
and gas.
"The total area of the sedimentary rocks in India is
17,20,000 square km. of which an offshore area upto a depth of
200 metres amounts to 3,20,000 square km. The >.ot.iy area has
been divided into 26 sedimentary basins of which 12 are of
immediate interest. These 13 basins have been placed in three
categories according to their individual potential. Some other
basins not so prospective are in the fourth category."
An Indo Soviet team of experts put the geological
reserves of oil at 12,700 million tonnes, of which 8,700
million tonnes (697o) are offshore and 400 million tonnes (317o) 2
are onshore.
So far as ONGC alone is concerned, the recent estimates
indicate 18.23 billion tonnes of resources of oil and gas exist
in areas under category I to III basins out of this 5.04
billion tonnes (27.66%) have been proved as geological reserves
Fig. 3 present progonstication anticipates 2/3 of jil and
remaining will be gas. However keeping in pace wi'h discoveries
in global context, this ratio of oil and gas may turn out 3
ultimately to 1:1.
1. The Hindu, Madras, September 1986, p.8.
2. The Geographer, The Department of Geography, Aligarh Muslim University, Aligarh, January 1985, p.47.
3. ONGC, Hand Book, Dehradun, 1991, p. 5.1.
20
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The total geological survey involves the use of 367
party years of field work during 25 years. ONGC has conducted a
total reconnaissance geological making of 24,000 sq. kms. of area.The
earth's surface has been examined by traversing 26.6 thousand
line kms and semi detailed and detailed mapping of 1.56 lakh
sq. kms and 41.5 thousand sq. kms respectively. ONGC has
established geological reserves of 3771 MMt of oil and 1271 MMt
of oil equivalent of gas as on 1.1.90. Trends of establishment
of recoverable reserves and balance recoverable :eserve.^- from
1981 onwards are presented in Fig.4. It is evident that within
last 8 years recoverable reserves have almost doubled due to
intensive and extensive exploration activities in all the
basins.
In the year 1986-87 - Fourteen Geological Survey
parties were deployed in onland areas for semi detailed mapping
covering 10,000 square kilometers against 7,830 square kms last
year. In 1987-88 14 geological survey were deployed in onland
areas for semi detailed mapping cover 11955 sq. kms against
10,000 sq. km last year. In the year 1988-89, 14 geological
survey parties were deployed in onland areas for semi d '-tailed
mapping and covered 14313 sq. km. (11955 sq. km InSt year).
In 1989-90 14 geological survey parties were deployed on
onland for semi detailed mapping in different sedimentary
basins covers 14,870 sq. km.
22
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During the year 1990-91, 51 seismic field parties
carried out siesmic data acquisition work in different onland
basins. These include 7 field parties on contract- Out of 44
onland departmental field parties, 37 parties were deployed for
2 D seismic data acquisition and 7 for 3 D seismic work. These
onland departmental seismic field parties covered 44783 SLK of
2 D seismic data and 631 standard sq. kms. of 3 D data. Area-
wise details of seismic data are given below in table No.l.
TABLE No.l
AREA WISE DETAILS OF SEISMIC DATA
Basin
Cambay
Rajasthan
Uppar Assam
Assam Arakan
Fold belt
Krishna Godavari
Cauvery
Bengal
Himachal Foot Hills Ganga Valley & other Areas Total
Number of Parties Deployed
2D
10
2
-
-
11
4
1
3
6
37
3D
2
-
3 -
2 -
-
7
Achievement
2D 3D (SLK) (S.Sq.Kms)
14598 393
6089
7447 83
7790
1666 166
1538
5655
44783 631
Source: Annual Report of ONGC, 1990-91, Dehradun, p.6
24
In addition to Geological Surveys, Geophysical sur/eys have
also been carried out. The Geophysical surveys invclved used of
181 field party years of gravity-magnetic, 530 party years of
seismic parties on-land and offshore. Geophysical parties have
measured gravity-cum-magnetic data of 2.44 lakh stations in
order to bring out differences in the gravity and magnetic
values at different points of the earth surface to be able to
mark out definite regional structure patterns and the thickness
of the sediments in the area as part of planning for seismic
surveys.
The 7 contracted field parties included 4 Soviet parties
under the intensive integrated exploration programme which
carried out seismic operation in Cambay, Cauvery and Bengal
basins. The party deployed in Bengal Basin acquired data on 3D
mode and the other parties in Cambay and Cauvery acquired data
on 2D mode. The Soviet field parties have already acquired the
seismic data as per contract except for 3D data in West Bengal
and have since been demobilised. In addition, two pole service
parties of Poland continued their work in Cambay and Krishna
Godavari basins. ONGC has already attained self-sufficiency in
processing seismic data subsequent to the installation of 4
regional computer centres at Bombay, Madras, Calcutta and
Baroda and IBM-3083 main frame computer at Dehradun.
25
Apart from this, the projected increase in seismic
surveys which are the same for both variants will be as in
Table No.2.
TABLE NO. 2
PROJECTED NUMBER OF SEISMIC SURVEYS
(in thousands of lime kilometers)
Year
1980-81
1981-82
1982-83
1983-84
1984-85
1985-86
1986-87
1987-88
1988-89
1989-90
West Coast
19.7
15.4
10.0
12.5
15.0
15.0
15.0
15.0
15.0
15.0
East Coast
4.8
4.7
10.3
12.5
15.0
15.0
15.0
15.0
15.0
15.0
Source: The Hindu Survey of Indian Industry, Madras, 1982, p.101.
26
Table No. 3 shows that there were 34 tctaj p.inber of
rigs onland during the year 1981. The total num^e: o' onshore
rigs increased from 34 to 38 at the close of the year 1982 and
38 to 40 in the year 1983. During the year 1984 and 1985 the
total number of onland rigs were 43 and 53 respectively. In the
year 1986 the total rigs were 64 as compared to 43 in the
previous year 1985. The total number of onland rigs increased
from 64 to 82 at the close of the year 1987. Out of these 78
were owned rigs and 4 on contract. During the year 1988 the
total number of offshore rigs increased from 82 to 92 at the
close of the year. Of these, 83 were owned by ONGC and the rest
charter hired. The total number of onland rigs increased from
92 to 104 at the close of the year 1989. Of these, ^1 were
owned by the commission and the rest were supplied by the
contractors on charter hired basis. Of these 104 rigs, 64 were
deployed for exploratory drilling and 40 for development
drilling. During the year 1990 the total number of rigs
increased from 104 to 115. Of these 115 rigs, 75 were deployed
for exploratory drilling and 40 for development drilling. In
the year 1991 the total number of rigs were 106. Number of
rigs both offshore and onland is shown in Fig. 5.
27
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28
TABLE NO. 3
EXPLORATORY & DEVELOPMENT DRILLING ONLAND AND OFFSHORE PERFORMANCE OF ONGC FROM 1981 TO 1991
Year
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
Onland
34
38
40
43
53
64
82
92
104
115
106
Offshore
7
7
13
14
13
15
20
26
33
33
35
Total
41
45
53
57
66
7Q
102
118
137
148
141
Source: Compiled and computed by the Research Scholar
from Annual Reports of ONGC (Various issues)
29
MARINE SURVEYS:
In 1963 ONGC started its offshore seismic surveys in
the Gulf of Cambay with the help of vessel "S.S. Mahindra" on
the basis of these surveys, the first offshore structure
Aliabet was discovered at the mouth of Narmada River. Another
offshore structure, Tapti was also delineated. During 1964-67,
regional reconnaissance, with local semi-detailed surveys was
undertaken by the Russian seismic ship,'Akademic Arknangelskey'
in the Gulf of Kutch in parts of the Gulf of Cambay and in
Arabian Sea, in the area off the coasts of Kerala, Gulf of
Mannar, Palk Strait and the Bay of Bengal. This survey revealed
a number of promising structures including Bombay High.
The discovery of oil in the basement of Bombay High has
given a new dimension to the explorating effort with the
possibility of extending the life of the field. All the old
oil fields are being reassessed with the help of new
technologies - To find new oil from the old fields. The possi
bility of increasing the recovery from the old fields parti
cularly from Bombay High, is being examined. This would
considerably increase the recoverable reserves from the
existing fields.
OVERSEAS OPERATIONS:
ONGC is providing assistance and cooperation tc* many
countries abroad. It has finalised on exploration and service
3 0
agreement with Iraq. National Oil Company for drilling in
South Western Iraq. Iraq was the first foreign country where
ONGC bagged a contract to explore, develop and exploit hydro
carbon on land. Seismic field work was started on March 19th
1974. ONGC entered into contract with the Government of
Tanzania for drilling a well at the Songo Songo island. ONGC
has been playing continuously a net worthy role in the
discovery of gas in Tanzania ONGC started drilling at Songo
2 Songo on 18th June 1976. A consultancy contract was signed
with Abu Dhabi National Oil Company on 29th January 1981 for
undertaking a geological study of Jurassices field.'
The overseas group continued to make headway in its
efforts for business abroad with the signing of a contract in
February 1987, for geological consultancy services with Abu
Dhabi National Oil Company for a value of US$1.43 million.
Business development overseas has been engaging the attention
of the commission as well as the Government of India at the
highest level and proposals on a variety of services are under
consideration with several countries such as Iraq, Libya,
Moracco, Vietnam and Tanzania.
1. Twenty Five Years of ONGC, Dehradun, 1981, p.19.
2. Ibid., p. 20.
3. Ibid. , p. 21.
4. Annual Report of ONGC 1986-87, Dehrahun, o. 14.
31
As hydrocarbon reserves of the country are limited and
demands are increasing ONGC has formulated a policy of entering
into exploration contracts with other Governments on profit
sharing basis to supplement indigenous production. Besides, it
would not only expose its geoscientists and engineers to the
international standards but also help them bring an increased
element of quality. Cost and time consciousness Hydrccarbons
India Ltd., a subsidiary of ONGC signed an exploration contract
on profit sharing basis with Petro Vietnam, negotiations with
the Tanzania Government for exploration work are in progress.
ONGC has built up a unique reputation amongst the
developing nations to diversify its activities and assist them
in their programme of hydrocarbon exploration and exploitation.
It has been able to sell its technical capabilities to many
countries and obtain contracts in the face to stiff competition
in Abu Dhabi. Negotiations are also being conducted with
several other countries such as Angola, Iraq, Libya, Qatar,
Sri Lanka, Uganda and Malaysia on services to be offered to
these countries.
ONGC has not only set higher and higher targets in the
successive years for indigenous production it has also gone
abroad for exploration in prospective basins in the developing
countries on production sharing basis and as a partner with
established oil companies to supplement indigenous production.
ONGC Videsh Ltd., a wholly owned subsidiary is handling these
32
foreign contracts. Seismic survey under production sharing
contracts in Vietnam waters was carried out by ves. -el Sagar
Samdhani. ONGC has recently executed consultancy Exploration
and Development Offshore.
EXPLORATION AND DEVELOPMENT OFFSHORE:
Exploration activities are being continuously
increased. Drilling of the first offshore well was started in
1970's at the H" outh of Narmada river in the Gulf of Cambay. In
1974 drilling of the Bombay High was taken up. Discovery of
oil basement of Bombay High augers well for the future. Efforts
were made to develop technology for locating and extraction of
oil from the basement. It also proposed to work out a detailed
plan for exploration in deeper waters.
Table No.3 shows that the offshore drilling performance
from 1981 to 1991. In 1981 the total number of offsho-e rigs
were 7. In 1982 there was again 7 rigs. The total nurber of
offshore rigs increased from 7 Lo 13 at tlie close of the year
1983. In 1984 the total number of offshore rigs were 14.
In 1985 the total number of offshore rigs decreased from 14 to
13. It again increased from 13 to 15 at the close of the year
in 1986. In 1987 on offshore operations, the rigs deployed
increased from 15 to 29 at the close of the year. Of these 20
rigs, 8 were owned rigs and 12 were on charter line. In 1988
the rigs deployed increased from 20 to 26 (including 1 owned
33
rig under repair at the close of the year. The fif-i" indige
nously fabricated drill ship 'Sagar Bhushan' ...r.s ;•. t into
operation during the year 1988. Drilling operdt:ions were
extended to Kerala - Konkan offshore within the spudding of the
first well on Cochin High Structure. In 1989 the offshore rigs
increased from 26 to 33. Of these 10 were owned by the
commission and the rest were on charter line. Of these 33
rigs, 25 were deployed for exploratory and the remaining for
development drilling. In 1990 the offshore rigs remained 33
throughout the year. Of these 33 rigs, 19 were deployed for
exploratory and remaining 14 for development drilling. In 1991
the total number of offshore rigs were 35. Thus it is observed
from the table that the exploratory and development drilling of
offshore rigs is satisfactory.
ONSHORE DRILLING:
The first exploratory well was started at Jawalamukhi
in 1957. Drilling in the beginning stage was undertaken on
Himalayan foothills, Punjab Plains, Ganga Valley, desert of
Jaisalmer, Assam, Arkan areas and Cambay basin. After this,
interesting structure including Krishna, Godavari and Cauvery
basins, Tripura Cachar etc. were taken for drilling. During the
year 1987-88, ONGC completed drilling of its deepest well at
madhubani in Bihar (5,957 metres). A well with a target depth
of 7000 metres was also stupped during the year near Jammu,
with owned rig.
34
DRILLING:
The drilling performance in terms of metreage drilled,
both exploratory and development, has improved several folds
during 1981 to 1991. Table No.4 indicates that the total
metreage drilled in 1981 was 212 thousand metres, of these 117
thousand exploratory and 94 thousand development. Total
metreage drilled in 1982, 1983, 1984 were 321 thousand, 385
thousand and 468 thousand. Of these, 151 thousand, 176 thousand
and 192 thousand exploratory and 170 thousand, 208 thousand the
275 thousand development. It rose to 441 thousand in 1985, 590
in 1986 and 732 in 1987 respectively. 192 thousand, 209
thousand and 293 exploratory and 275 thousand, 232 thousand and
296 development. Total metreage drilled in 1988 increased from
732 to 842 in 1988 of these 373 thousand exploratory and 469
thousand development. The total meterage drilled during the
year 1989 was 1031 thousand against 842 thousand in the
previous year 1988. Of these 494 exploratory and 537 develop
ment. During the year 1990 and 1991, the total metreage
drilled was 132.3 thousand metres and 1053.26 thousand metres
off these 605 thousand metres and 470.81 thousand metres
exploratory and the remaining 718 thousand and 582.^5 thousand
metres development. The drilling efficiency in terms of metre/
rig months (cycle speed) registered an improvement of 22.5 per
cent in 1990 over the last year. The actual cycle speed
35
increased from 679 in 1989 to 832 in 1990. The drilling
performance in terms of metreage drilled, both exploratory and
development, is also shown in Fig. 6.
TABLE NO. 4
THE DRILLING METREAGE PERFORMANCE OF
ONGCC FROM 1981 TO 1991
(in 000)
Year
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
Exploratory
117
151
197
192
209
293
333
373
494
605
470.81
Development
94
170
208
275
232
296
399
469
537
718
582.45
Total
212
321
385
468
441
590
732
842
1031
1323
1053.26
Source Compiled and computed by the ReseaTh Scholar
from Annual Reports of ONGC (Various issues)
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37
PRODUCTION:
At the time when ONGC was born, about 34 years
ago oil production was a rtiyth in India. Today, within three
decades of its existence it has assimilated the technology of
over 100 years to emerge as the premier oil company in India
and is now being looked upon as a symbol of model enterprise in
the country.
In 1970s the ONGC ventured into offshore
prospecting for oil. In February 1974, oil was struck at Bombay
High and commercial production began from May 1976. 1y«Os have
witnessed several new promissing discoveries, both onland and
offshore as a result of a very pragmatic and deliberate
exploration strategy followed by ONGC to intensify the efforts
in the producing basins of Bombay High, Cambay and Upper Assam
and extending efforts in other basins. Significant discoveries
are Gardhar, Saleg and Manda in Gujrat, Neelam in Bombay
offshore GS-16 in Godavari offshoreand a series of new
discoveries in cauvery Basin like Navi-Manain, Kovil Kalappal,
Bhuranagivi and Blamrilam, the discoveries at Sanari,Khovaghat,
Namti and Cochar fields in Assam have added new dimension to
the future production potential from the Indian sedimentary
basins all these discoveries have ultimately contributed to the
build up in the reserves that has taken place siiice the
beginning of the 6th plan which stand today at 5042 million
tonnes of oil and oil equivalent gas. The impressive success
38
ratio and exploratory discovery under which has been achieved
is a result of a very bold and deliberate exploration manage
ment philosophy which give ONGC further confidence uo meet the
growing petroleum needs in the coming years.
During the sixth plan (1981-85) period 41 hydro
carbon strikes/discoveries have been made. The total accretion
to the existing geological reserves in 1980-85 has been 894
million tonnes of oil and gas. ONGC expects to establish for
the future additional reserves of 1,400 million tonnes of
hydrocarbon through new exploration. Of the new 1,400 million
tonnes to be established within the next five years (1985-90).
810 million tonnes will be established in category 1 basins
(Assam, Bombay Offshore and Gujrat) 545 million tonnes in
Category II basins (Rajasthan, Cauvery, Krishna Godawari,
Andaman, West Bengal, Himalayan foothills, Ganga valley,
Tripura, Nagaland), and the remaining in category III basins
(Kutch, Saurashtra, Kerala, Kankan and Mahanadi) Recoverable
reserves also increased from 328.42 million tonnes in 1980-81
to 450.90 million tonnes in 1984-85 but the last four years
have registered a sharp shortfall in reserves. A more revealing
comparison would be to begin with the year 1983 when reserves
were 482.81 million tonnes. This figure fell to 465.10 million
tonnes in 1984.-'- This clearly shows that in 1984 and 1985
Indian oil reserves were occurring faster than ever before.
1. Indian Today, New Delhi, September 30, 1986, pp. 103-105.
39
WORLD OIL DEMAND AND SUPPLY:
Table - 5 reveals that the global crude oil demand is
expected to increase slowly. The probable future require
ment of each sector are projected, based upon his historical
patterns, GDP assumption and technology evolution including
inter-fuel substitution. From the consumption of 61 MMBD in
1987, it will increase to 69-70 MMBD in 2000 A.D. and to 78
MMBD in the year 2010 A.D.
TABLE - 5
OIL DEMAND (MMBD) (MILLION BARRELS PER DAY)
Country
Free World
CPE
Total World
1987
47.49
13.75
61 .24
Year
2000
54.62
15.45
70.07
2010
61.14
17.56
78.70
. ' K t i i i i ' f : ONCt l l . n i d n.M,!. . I ) . - I n . I . h i l l . I ' l ' l l , | ) . l . ( ) .
40
Table - 6 reveals that in late 90's increasing oil
demand of free world can be met only from OPEC supplies
creating opportunity for OPEC to influence the world oil
market.
TABLE No.6
OIL SUPPLY (MMBD) (MILLION BARRELS PER DAY)
Country
Non-OPEC
OPEC
CPE
Total World
1987
25.29
19.03
15.88
60.20
Year
2000
24.17
30.64
15.25
70.06
2010
25.74
35.00
17.96
78.70
Source: ONCC Hand liouk, Dchradun, p. 3.6
41
The Eighties have witnessed dramatic developments z,\ the oil
front with the discovery of large reserves of r.r.d? oil and
natural gas in the onshore and offshore areas. The spurt in
crude output to 28.99 million tonnes in 1984-85 from 11.77
million tonnes in 1979-80 was mainly on account of the
valuable contribution of Bombay High. The natural gas pro
duction also improved to 7.24 billion cubic metres from 2.36
billion cubic metres in the same period.
In the seve'nth plan, however, the activities of the
Oil and Natural Gas Commission operating in designated blocks
in the offshore and onshore areas related mainly to explora
tory drilling and the additions to proved reserved did not
result in any significant increase in output iinmediately. The
large reserves will, of course, becoming in handy in Llie Eight
plan. The output of crude will thus be rising to 34.5 million
tonnes in the terminal year of the seventh plan from 28.94
million tonnes in 1984-85. The production of gas,on the other
hand, could have risen more impressively but for the delays in
creating that the necessary infrastructure facilities and
completing fertilizer and petrochemical projects based on
Leo, Interesting Phase in Oil, The Hindu Survey of Indian Industry, Madras, 1989, p.33.
42
natural gas. The estimated production of gas will th^s be 14
billion cubic metres (bum) against 7.24 billion cubic metres at
the end of the sixth plan.
The pTQ<^feSj) in the Eight Plan may be more comforting
as it is targeted that crude output should rise by 16.5 million
tonnes to 51 million tonnes by 1994-95 and natural gas to 100
million cubic metres daily from 40 million cubic metres in
1989-90. Thus the total production should be 215.09 million
tonnes and natural gas 138.61 bcm (in 1990-95) as compared to
157.38 million tonnes and 56.13 bcm in the seventh plan or 2
increase of 36.7 per cent and 146.9 per cent respectively.
In the Seventh Plan, the increase in crude ou .put was
more pronounced by 53 per cent on a lower base and gas
production by 130.5 per cent. A new breakthrough is likely to
be established in respect of crude output in 1990-95 and the
growth rate will depend on expeditions exploitation of proved
reserves. The availability of natural gas will be increasing
with larger yield of associated gas with rising crude output.
The additions to crude output by 16.5 million tonnes will come
from Bombay High, the Gandhar and Krishna Godavri and Cauvery 3
basins. The share of oil wells - old and new in the offshore
1. Leo, Interesting Phase in Oil, p.33
2. Ibid.
3. Ibid.
43
and onshore areas on the west coast in incremental production
will be ten million tonnes that of Krishna-Godavri and Cauvey
basins six million tonnes and other five lakh tonnes.
During 1988-89 there were 18 new finds of oil and gas,
the significant ones being Nada in Gujrat, Sonari, Uriamghat,
Adamtilla and Banas Kandi in Assam, Mandapeta and Bantumilli
in Andhra Pradesh. The discovery of oil at Nada registered
the highest well productivity in onland areas ^o far and will
significantly contribute to increasing the production
potential from Gujrat during the VIII Plan. The crude pro
duction during the year was 29.64 million tonnes, gas supplies
6.98 billion M and LPG production 6.74 lakh tonnes.
Table No.7 shows that ONGC's aggregate crude oil
production during the Seventh Plan will be 143.64 million
tonnes. The onshore's share and offshore's share will be 41.33
million tonnes and 102.31 million tonnes respectively. The
total crude oil production during the plan is 159.14 million
tonnes in which 15.50 million tonnes will be produced by Oil
India Ltd. Company basin will produce 25 million tonnes.
ONGC's onshore production has been showing an increasing trend
1. Annual Report of ONGC Dehradun 1988-89, p.8.
44
TABLE NO. 7
ONGC'S CRUDE OIL PRODUCTION IN THE SEVENTH PLAN
(in million tonnes)
A - ONCX:
Combay basin
Upper Assam and Nagaland
Sub Total
2 Offshore
Total 1+2
B - Oil
Total (A+B)
1985-86
4.10
2.84
6.99
20.17
27.11
3.03
1986-87
4.50
3.03
7.53
20.52
28.05
3.03
1987-88
4.90
3.03
7.93
20.52
28.45
31.48
1988-89
5.50
3.03
8.83
20.35
28.88
31.91
1989-90
6.00
4.40
10.40
20.75
31.15
34.53
Total
25.00
16.33
41.33
102.31
143.64
159.14
Source Seventh Five Year Plan, Government of India, Planning Commission, New Delhi, 1985-90, Vol. II, p.156.
45
during the plan contrinuously from 6.94 million tonnes in
1985-86 to 10.40 million tonnes by 1989-90. Offshore pro
duction in the whole plan has constantly been about 20.52
million tonnes. The growth rate of crude oil production
during the plan is 14.90 per cent (1985-86 to 1989-90). The
increase in ONGC's production during the plan would come from
the cambay basin upper Assam and Nagaland areas the increase
in Cambay basin would come from development of Kolar field and
the development of the heavy oil fields in North Gujrat
areas.
The year 1990-91 has been an eventful year for ONGC.
A large number of initiatives were taken in formulating
specific schemes for increasing oil and gas production
improving the utilisation of natural gas, stream living
systems and procedures, adding new dimentions to monitoring
systems of key activities with particular reference to
development schemes, managing the reservoir based on scienti
fically established practices, human resources management etc.
These initiative are intended to bring long term benefits to
ONGC.
During the year 1990-91 oil and gas deposits have been
discovered in 19 new structures. Most of the oil deposits have
been found in Bombay offshore and gas has been found in
different new structures in Krishna, Godawari, Rajasthan and
Bombay offshore.
m
m
46
Table No.8 reveals ONGC's production of crude oil and
natural gas from 1980 to 1991. In 1980 the crude oil and
natural gas production were 9.20 million tonnes and 1013.99
million cubic metres. In 1981 the crude production was 9.21
million tonnes and natural gas 972.15 million cubic metres
respectively. It rose to 13.18 million tonnes and 1230.41
illion cubic metres in 1982. It went up from 23.15 million
tonnes and 1230.41 million cubic metres in 1982 to 18.23
illion tonnes of crude oil and 1856.72 million cuDic metres of
natural gas in 1983. It was 23.15 million tonnes of crude oil
and 2222.51 million cubic metres of natural gas in 1984. Again
it rose to 26.26 million tonnes, and 2789.94 million cubic
metres in 1985 and 27.51 million tonnes and 3308.37 in 1986.
Production of crude oil and gas sales registered an increase in
1987, i.e. 27.86 million tonnes and 5042 million cubic metres
of gas as compared to previous year. In 1988 crude oil
production increased from 27.86 million tonnes to 27.9 million
tonnes, gas supplies from 5042.47 million cubic metres to 5874
million cubic metres. It again rose to 29.64 million tonnes and
32 million tonnes and 6931.84 million cubic metres and 8610.03
million cubic metres in 1989 and 1990. The crude oil production
during the year 1991 was 30.345 million tonnt-s and gas
production 9865.71 million cubic metres. The gas production
during the year 1991 suffered a serious set back on account of
certain technological and environment constraints. The crude
47
TABLE No. 8
PRODUCTION
Year
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
Crude Oil (Million tonnes)
9.20
9.21
13.18
18.23
23.15
26.26
27.51
27.86
27.91
29.64
32.00
30.345
Natural Gas (Million cubic metres)
1013.99
972.15
1230.41
1856.72
2222.51
2789.94
3 308.3/
5042.47
5873.01
6931.84
8610.03
9865.71
Source Compiled and computed by the Research Scholar from Annual Report of ONGC (various issues).
48
oil production from 1985 to 1989 increased at a -/ery slow rate
but it rose rapidly from 1985 to 1987.
It is concluded that the production of crude oil has
been increasing but at a slow rate of growth. Natural gas
production was better than crude oil production. This also
shows in Fig. 5.
Table No. 9 reveals the number of wells drilled in
both onshore and offshore from 1981 to 1991. The total number
of wells drilled in 1981, 1982 and 1983 were 104,144 and 179.
The offshore wells were 53, 58 and 74 while onshore wells were
51, 86 and 105. In 1984, 1985 and 1986 total number of wells
drilled were 203, 201 and 266 respectively. The offshore
wells were 71, 79 and 117 and onshore wells were 132, 122 and
149. In 1987 the total number of wells rose to 302 out of
which offshore wells were 115 and onshore were 194. In 1988,
1989 and 1990 the total number of wells increased to 363 to
465 and 625. The offshore wells were 133, 182 and 253 and
onshore wells 230, 283 and 372. During the year 1991, 508
wells were completed. The offshore well were 240 and onshore
wells were 268. The offshore drilling was not satisfactory
in 1984, 1987 and 1991 because the growth rate was 4.05 per
cent 1.70 per cent and 5.14 per cent. The offshore growth
rate of wells was declining through out the period under
49
TABLE No,
DRILLING ACHIEVEMENT NUMBER OF WELLS DRILLED
Year
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
Offshore
53
58
74
71
79
117
115
133
182
253
240
Growth rate in (7o) of offshore
9.43
27.59
-4.05
11.27
48.10
-1.70
15.65
36.84
39.01
-5.14
Onshore
51
86
105
132
122
149
194
230
283
372
268
Growth rate of onshore (in %)
68.63
22.09
25.71
-7.58
22.13
30.20
18.56
23.04
31.45
-27.96
Total
104
144
179
203
201
266
309
363
465
625
508
Growth rate total in
1
38.46
24.30
13.40
-0.99
32.34
16.17
17.48
28.09
34.41
-18.72
Source: Compiled and computed by the Research Scholar from Annual Reports of ONGC (Various Issues).
50
study. The highest growth rate was in 1986 i.e. 48.10 per
cent. The onshore growth rate during the year 1985 and 1991
was not satisfactory because the growth rate was 7.58 in 1985
and -27.96 in 1991. The growth rate of onshore is declining
during the period under study. The total growth rate of both
offshore and onshore was declining during the period under
study from 1981 to 1991. During the year 1985 and 1991 the
total growth rate of both offshore and onshore was very low,
it was -0.99 in 1985 and -18.72 very low, it was -0.99 in
1985 and -18.72 in 1991. It rose to 32.34 in per cent in
1986. It came down into 16.17 per cent in 1987. In 1988 the
growth rate was 17.48 per cent. It again rose to 28.09 per
cent in 1989 and 34.01 per cent in 1990. It came down to
18.72 per cent in 1991. The table reveals that the drilling
performance was not satisfactory which was responsible for
slow growth rate of wells during 1981 to 1991, the drilling
achievement is also given in Fig. 7.
51
on o c
n
O Z o o X Q]
a D3 o o ?r
o T5
O
rt
O nr - (
a c 3
o
m X {-
O DO
o DO -<
t D m < m r-O "0 m z - I
if-
H O 5;
CO o o
I
o o
I
•;K-
en
Ol o O
CD O O
(D f j K
; -
o o
O O
m f -f -
D
n
Z
> o fn <
m m z
Ol Cll
' o 01
52
TABLE NO. 10
PRODUCTION OF LPG IN ONGC
(in 'ooo tonne
Years
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
Production
_
-
.73
1.61
1.96
2.42
3.20
4.51
5.10
6.74
7.18
8.76
Growth (Rats in %)
_
-
-
120.55
21.74
23.47
32.23
40.94
13.08
32.15
6.33
22.00
Source Compiled and computed by the Research Scholar from Annual Reports of ONGC (Various issues).
53
Table No. 10 shows the ONGC Liquified Petroleum Gas
(LPG) production from 1980 to 1991. In 1980 and 1981 the
L.P.G. production was nil in 1982 th<2 L.P.G. production was
only 0.73 lakh tonnes. It rose to 1,61 lakh tonnes, 196 lakh
tonnes and 242 lakh tonnes in 1983, 1984 and 1985. In 1986 it
went up to 320 lakh tonnes production of LPG during 1987
registered on increase of 451 lakh tonnes as compared to 320
lakh tonnes in previous year 1986. It was 510 lakh tonnes and
674 lakh tonnes in 1988 and 1989. It went up from 674 lakh
tonnes in 1989 to 718 lakh tonnes in 1990. Highest ever LPG
production of 876.8 thousand tonnes was recorded during the
year 1991. This represent an increase of 22 per cent over the
previous year 1990. The growth rate of L.P.G. during the year
1981 was 120.55 per cent. It declined in 1983, from 120.55 per
cent to 21.74 per cent. Again it rose in 1985, 1986 and 1987
respectively. It was 23.47 per cent, 32.23 per cent and 40.94
per cent. It came down to 13.08 per cent in 1988. In 1989 it
was 32.15 per cent, 1990 it was 6.53 per cent and in 1991 it
was 22.00 per cent. It is observed from the table that the
growth rate of L.P.G. is fluctuating throughout the period
under review.
CORPORATE PLAN:
The inherent high risk character of petroleum
industry,the predictable price fluctuation of oil in the world
54
market and the geo political situation in the middle east
countries and its bearing on national economy warrants
preparation of long term plan (1990-2015) covering all the
major activities of oil business and periodic relook. ONGC
prepared its first Corporate Plan for the period 1985-2000
considering the external environment viz. demand, foreign
exchange reserves etc. necessity has been felt to review the
previous corproate plan and extend the same upto 2015 covering
the period upto XII plan keeping in view the national and
global trends. The production of hydrocarbon in the country
has increased considerably with quantum jump of 50 MMT in
successive plan periods and is likely to increase further in
the coming years. The demand is soaring so rapidly that the
percentage level of self sufficiency is showing declining
trends. The oil demand projections indicate a trend of widening
gap between the indigenous production and demand. The present
corporate plan adequately highlights the demand management and
inter-fuel substitution, anticipating more prolific gas
discoveries in future.
The terminal year oil production of VIII plan is
expected to increase to 46 MMT from 31.5 MMT in the beginning
of the plan primarily from existing fields as well as
delineation and development of the recently discovered fields.
The terminal year oil production of IX plan in base case would
be around 54 MMT. Beyond IX plan, the increase in the
55
te:rminal year till production in the successive plan would not
be very high because the production from the ageing fields as
likely to decline and some of these fields may be teritiary
recovery.
The terminal year oil production of X, Xi, XII plans it
base case would be around 59, 63 and 62 MMT respectively. If
significant hydrocarbon discoveries are made in the forth
coming plan the production scenario may altogether change. In
high case the terminal year oil production of IX, X, XI and XII
plans may be around 58, 67, 73 and 75 MMT respectively. The
total anticipated production of hydrocarbons in the terminal
year of VIII, IX, X and XII plans in the base case would be
around 81, 96, 110, 120 and 121 MMT respectively and in high
case 81, 101, 120, 134 and 1^0 MMT respectively.''- It is
evident from these profiles that growth of oil and gas
production may be very good upto X plan but in the successive
plans it may just maintain the level of production unless a
break through is made in exploration in category III and IV
basins. More "easy to locate" hydrocarbon traps have been
founds. Now the stress would be on locating stratigraphic and
subtle traps on the known oil and gas provinces and to upgrade
II and III basin on the basis of aggressive exploration policy.
1. ONGC Hand Book, Dehradun, 1991, p.4.1.
56
Geoscientfic surveys will be further intentified 3D seismic
surveys in onshore areas would be increase to 7450s. sq. km.
in XII plan from 2745 S. sq. km in VIII plan (270% growth). The
2D surveys in onshore and total 2D + 3D surveys in offshore may
be maintained upto the present of VIII Plan. The growth in
reserve accretion during VIII, IX, X, XI and XII plans may be
around 1232, 1410, 1430, 1460 and 1500 MMT respectively by the
end of XII plan the countries reserve establishmen*: of hydro
carbon may be of the order of 12.23 billion tonnes against the
present level of 5.04 billion tonnes. During the same period
the hydrocarbon resource position is also likely to improve to
33.7 billion tonnes from 18.3 billion tonnes as on 1st January
1990. It is expected that the reserve base so established
would be helpful in sustaining the anticipated oil and gas
production profiles of various plans. Sansitinity analysis has
been attempted to assess the effect of adverse variation of
reserve accretion on production profiles. It is observed that
base case profile of 100% reserve accretion and high case
profile of 807o reserve accretion show very good match. Explo
ratory drilling is likely to increase to 47.3 lakh metres in
the XII plan compared to 29.77 lakh meters in VIII plan. The
major increase will be in the onshore areas. There is not much
variation in the number of exploratory wells in VIII to X Plan.
It will increase to 1424 wells in XII plan compared to 1102 in
VIII plan. The exploratory drilling may lead to discovery of
57
some important fields which may compensate the fall in produc
tion from the ageingfields .
The development drilling would be intt.-iSi c'ied in the
knonw and delineated fields. Infill drilling v>7iil also be
carried out. All efforts will be made to reduce the number of
sick wells. Production will be enhanced by better reservoir
management. The development drilling metreage will increase to
5992 lakh meters in XII Plan compared to 3877 lakh meters in
VII Plan in base case against 6424 lakh meters in XII Plan in
high case. The number of development wells to be drilled will
also increase order of 1922 in base case and 2059 in high case
compared to 1693 in the VIII Plan, The plan outlays will be
gradually decreased from fe. 26,078 crores in VIII Plan to
fe. 20,207 crores in XII Plan. The major reduction will be in
the capital acquisition Rs.500 crores each have been kept for
R & D work in all the plans from IX to VII. Internal resources
may be 180 per cent of the plan outlay in XII Plan.
Because of the several unknown variables there are some
difficulties inherent in planning for petroleum exploration.
Therefore, the numerical figures given in this thesis should be
considered more as fair estimates rather than rigid
quantities.
Suniinary (Base Case)
> i i r d c r a U r «
• « l * m i e l u n r r y a Oruhor* 2D
BD CXtiOor* hD • BD
I l » » n M ( 0 < OUl)
Dr&Ual 1 O a ^ ar« L i p l o r t t o r j Ufe'J-*!^ V t U i PycJt Bpwx^
Ihrt «J 0 ptji ui I UklrtA^o Wkllj Cyol* BpeaJ
T o U l Ooihor* ( t t p . 4 D n . ) UhU-^iKf,* WkLU Cycla B(4><xl IUS>
I>rUUiMl 1 Onmht>rm K j p l o r k l o r j UHU'^A^II
W*1U Cycl* Bpeul
J>«Tttl&pm«al U a i U M ^ B
VTklU
Cyul* U;«>uO
T e l U Orrshco-* (Xxp. * D « T . ) U a u - M ^ Walls C j d * Bp<<od lUffi
T D U I O B O C
&xplor» lo i7 U<>u-«&^ WKUJI
Of ci« Sptxad
&«T*Jopm«nt
Uoirt»A<> Wulln Cycju (l(.««l
ToUJ ( t i p . . jymt.) UliUlAIJU
w<,!:« ('ycJto fi('4M»:
IW^ Mo of n i ^
?-ro<lJcUon Tu-inloxl Yku-', ( C u s i u U U f * )
D OU Orvshore Ort»hore TCIAJ
U) O u Or\£hor« OfCihore
rULxndAl
1) riiin OutUyi U) IniarnAl RdBourooa
TJnll '
•000 8LK 8 a<] km. 'OOO LK
U U l
'000 U o i r w Sumburi U o u i r / a i j U o m h
'000 UmrM VuinUna Usuir/IUj Uonih
'000 Ui«.ru« Muiiit.<!ri UuUi[7Ill£ Uunih Rl^ y««r-i
'OOO UiurM Humburi Uftur/I l i j Uon;h
'(XK) u«Lr*« WMliit.<il a
UbUii/ni^i uoi i i i i
"000 Uoiro« Kumbara Uiiuir /nij Uonlh 111 yo^.»
'0(X) U.llr-ua I/UIHIMJIB
UuUir/nii Uonlh
'0<X) Ui«.n»i W i i n i N i l - n
U r.'lll^ UoMlli
•(XX) U i i l H x i
U i l i l . K i : n
u /in^; Uuiiili Mi/J Yiwin NuMll-lIt)
UUl.
DCU
lU. Cmita lU Croroa
V n i P l»r \
130 BT«6
l e u
1932
• 1 0 6 0
eoe 4 0 6
aGoe 1 1 3 0
BIG
4GHr. * IBJli
0 3 0 OOO
0 6 8 « 0 3 831
i u n \ Bli r
104;!
2 2 6 9 8 6 0
1 1 5 3 164
8 0 7 7 U 0 2
S71
3H77 1 0 0 3
0 7 0
(mi,-i ;;7i)i;
7 4» 701 lO-l
IS ( 0 4 ) 31 ( 1 2 B ) 4 6 ( l O O )
10 (3G) 2 5 ( lOO) 3S ( I 3 r n
3 6 0 7 8 s i c i a
tXPV«.o
l e a 4 0 1 0
1 6 0
1 4 1 0
B 7 3 e 787 4 7 6
8 6 0 2 1347
6 3 0
8 0 3 1 C134
637 6 6 0
1147 B62 661
UHll 3715
107 4
2 3 0 2 7 2 6
1 1 6 8 1 6 0
30(16 1 1 3 0
5 4 9
D04 7 1 7 2 0
0 4 7
Oil 3 3 ;!tlM)
7;;o 103 4
zm
10 (t)0) 3 6 ( 1 6 8 ) 64 (2B7)
IB (631 2 7 ( 1 3 0 ) 4 2 ( l O j )
3 4 0 2 3 2 7 2 1 7
X P U L D
136 7 0 6 0
IBO
1 4 3 0
8 8 5 3 e 2 « B03
40B1 1 3 4 3
624
6 0 0 4 2 1 6 7
0 6 2 6A3
1144 3 6 2 0 6 2
1 4 1 0 4^0
1772
2 5 8 2 7 7 2
1 2 8 0 167
3 0 0 7 1 1 7 6
OOl
C4UU 1 7 0 3
0 6 0
04110 UDJi)
71,1 1 0 6 0
21 1
22 ( 1 0 3 ) 37 ( l e n B9 ( 2 6 4 )
21 ( 9 0 ) 30 ( 1 4 3 ) Bl ( 2 3 3 )
aioao 3 3 6 0 3
XJ r u a
ISS T460
160
1460
28 IB 1048
BJ4
4 2 3 3 1400
t22
77«B 2«4S
6 « 0 070
I I 8 7 3E2
1024
U V 3 43t>
1022
2 6 6 0 787
1332 103
4(532 1 4 0 0
6 0 6
67:;o 1635
060
1^4 0« : _ ; . ! 'j
TOO 1142
Z23
2 3 ( 1 1 3 ) 4 0 ( 1 0 2 ) 63 ( 3 0 6 )
24 ( 1 1 3 ) 1 3 ( 1 6 7 ) 67 ( 2 7 0 )
2O034 75567
xiiruB 1
ISO T 4 6 0
1 6 0
leoo
S 6 i : 1 0 5 8
B47
4 4 2 0 1 4 7 6
6 7 6
7 0 3 3 EB33
6 0 2 0 6 6
1 2 1 7 3 « e
10«6 1
16711 4 4 7
1 8 7 7
£ 7 8 0 8 1 3
1 3 6 2 I M
4 / 3 0 1 4 2 4
6 2 7
6 0 0 2 1 0 2 2 101 6
107 2 2 3 3 16
T0\) 1 1 1 0
Z26
24 ( 1 1 7 ) 38 ( 1 0 4 ) 6 2 ( 3 1 1 )
2E ( 1 2 3 > M ( 1 6 7 ) 60 ( 2 0 3 )
2 0 2 0 7 3647G
* Doe* not inclutla 25000 mu oo »oooum of NnUonal Biunpla DnUltig ' &k&iK! on U\« Cocutnuni aubnuiuid on 30 4 00.
S o o r c o : ONCC Hand f^ook on c i L- . , l ) chr ; idun 1991 , p . 4 . 5
TARLI-: NO. 12
Summary (High Case)
>aTtleuIu'i
ftdLii&ic txirwtji Oiubor* BD
OfTihor* SO • 8t)
M ( 0 « O H )
W . J U
Tbt*J OtLaliur* ( X i p . « l ivv.)
W k l U O / i j k b ( a » / l
l>^nr ••'••pniiMl
C7cJ» BpAMj
T o U l O i r o c kxplormtMy
Cycle SpMtd
&VT « l 0 p B^«CLi U w r f a k ^ b
C > d » Spcxxj
»«>t»J C l i p . ••
VeUc C y d * Speed
Ka of lUg*
I>«T.)
( O u a u l a U v * )
Ollihan, Ttn*J
11) B u Oixalior* On»hor«
Unit
' 0 0 0 HUE B.Bq tm. ' 0 0 0 LK
U l i i
'OOO U>«.rM
Uuu.r/lu<i Uonll i
' 0 0 0 U « C r M WuniUil'a i i « U . i / l ( | ^ Ml,Mil.
' 0 0 0 U u l r u o
tJumUiri UuUir/IU^ UonUi
' 0 0 0 U«(.i-M Uuliil<«ra U u U i i / l l l ^ Ui ir . l l .
' 0 0 0 UaCTM R U E b e n Ue ier /Ulg Uonih
' 0 0 0 Uixrea S u a bars U e t a r m i a Uonih
'OOO Uecrea Butnbara
' 0 0 0 UaLTM Numbera
"000 Umroe Nucbora U e u i r / m ^ UoE'.h Rl« Y»»r» Numbni*
U U l
bCM
n X - L D d A j
I) I l i j , OulUyt U) UiUjJTuJ }UoCAJI«j«
' vmyua pyuii xriM
IBS fi746
IBO
1 8 3 :
4UC
UIIKfl 11 ntl
m i l
4LttC 1 6 3 6
C36 0 0 0
DHH • li.-l 0.11
I S B ]
l b 4 2
& 2 6 e
eao 1 ) 6 3
164
8 8 7 7
1102 B71
8 8 7 7
1 6 0 3 D70
6 8 6 4 2 7 0 6
7 4 8 7ft4 104
I B ( 0 4 ) 31 ( 1 2 0 ) 4(1 ( l O O )
10 f3G) BD ( 1 0 0 ) 36 ( 1 3 b )
C1B12
XI FiAA x n p U i )
wio 1 6 0
1S6 T0«0
IBO
ise rise
) B 0
l i l O
IBS T4B0
IBO 1 4 3 0 1 4 6 0 lEOO
UTSU TOT 47B
BnbU 1D47
D4C)
won?
ft03
l«UU Bile
» « 3 1
8 1 3 4 0 3 7 0 6 8
1 147 PIIU n t i i
18B3 4 1 6
leae
n 4 3 0 T67
1 1 7 8 172
8 8 8 6
1 1 3 8 B4e
B17B 1 7 6 2
0 6 0
ooei 2 0 0 1
7 2 8 • 1 0 4 0 coe
10 ( 0 7 ) 30 ( 1 0 1 ) CO ( 2 0 0 )
IR ( 0 3 ) 28 ( 1 3 2 ) 4 3 ( lOB)
8 6 4 1 4
20 ( \O7
7 1 3 6
8 2 4 8 ObS
0O4
I 1 4 4 Piiu U l U
l E l B 4 6 0
1774
8 6 6 0 B02
1804 171
9 0 0 7 1176
B61
6 7 0 8 1872
062
0 7 0 6 304B
760 1076
8 1 7
2 1 ( l O D ) 4:^ (2c>r.) 07 ( 3 1 0 )
81 (BO) :w ( 1 6 0 ) E3 ( 2 4 0 )
8 3 7 7 0 3(U;6P
• Do .* r^l Ir^lurfB 2 6 0 0 0 ml^ or, a .« .un i of K»uor.»l B»inpl« I„.ui.,u!
BO IB 1046
B34
BOIB 1080
B47
• tISb 1B07
B4t)
PO80 8 8 6 6
873 008
1 1P7
11U4
1 6 0 0 4 70
1821
4 7 1 T I o n
8 7 7
8 2 3 0 B&Z9
083
lUlT OPO
lOoe
1707 4 8 8
1 8 7 0
8 7 8 7 6 2 2
1871 108
8 0 2 4 664
1 4 3 8 180
4 6 8 2 14O0 soe
8 1 3 6 1077
082
4 7 3 0 1424
&37
e-C34
SO50 1 0 2 2
10817 5377
774 1184
833
26 (123 ) 47 (22()j 73 (34 B)
BO (117 ) 5G (168) 81 (SB5)
82 4 05 3004B
11164 M 8 3
6 0 7 J 152
8 3 1
26 ( 1 3 1 ) 40 ( 2 4 0 ) 76 ( 3 7 1 )
21 ( 1 3 2 ) >Je ( 1 8 3 ) 66 ( 3 1 6 )
8 2 3 7 7 4 1 0 3 6
S o u r c e : . ONGC Hand Book, op. cit., Dehradun 1991,p.4.6
60
CONCLUSION:
In conclusion, it may be observed that the Oil and
Natural Gas Commission (ONGC) which has recently been converted
into a public limited company has a vital role to play in the
oil scenario of the country. In the new setting it will shed
its three decade old nomenclature and will be vested with
structural, organisational and financial autonomy to compete
better in keeping with liberalisation of the econci '. In the
Chapter that follows, a conceptual framework of the tnesis has
been presented to highlight the plan of the stuuy, iL.- design
and objectives.