By Sethuraman NR
(Reuters) – Global energy major BP (NYSE: ) has pledged to increase oil production by 44% and gas output by 89% from India’s largest field off the west coast under a ten-year deal, according to block operator Oil and Natural Gas Corp on Thursday.
ONGC on Wednesday appointed BP as its technical service provider to help boost production from a base crude output of 45.47 million metric tonnes and 70.40 billion cubic meters (BCM) of gas.
Energy major Shell ( LON: ) also participated in the tender, which sought advanced recovery technologies and expertise in managing complex mature deposits to boost production, ONGC said in an exchange filing.
BP projected a 44% increase in oil production to 65.41 million tonnes and an 89% increase in gas production to 112.63 BCM from the Mumbai High field, which was discovered in 1974.
India, the world’s third-largest oil importer and consumer, intends to rapidly increase its oil and gas production, which has stagnated for years.
Production ramp-up is expected to begin in the next fiscal year starting April 1, with full visibility expected by 2027-28, ONGC said in a filing.
Incremental production is expected to generate additional oil and gas revenues for the country of up to $10.30 billion, and contributions from royalties, taxes and other duties amounting to as much as $5 billion, the researcher said.
In return, BP will receive a fixed fee for the first two years, followed by a service fee based on a percentage share of revenue from net incremental production, after recovery of incremental costs, according to ONGC.
The field peaked at 471,000 barrels of oil per day in March 1985, and its output fell to about 134,000 bpd in April 2024, last year’s tender filing showed.
