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ONGC to focus on oil, gas hunt

— PHOTO: V. V. KRISHNAN

SETTING SIGHTS HIGH: R. S. Sharma (right), Chairman and Managing Director, ONGC, with A. K. Balyan, Director (Human Resource), addressing the media in New Delhi on Friday.

NEW DELHI: Seeking to set high standards in performance and improve reserve replacement ratio by intensifying exploratory efforts, State-run Oil and Natural Gas Corporation (ONGC) on Friday announced that it was raising its spending on oil and gas hunt by over 75 per cent during the XI Plan.

ONGC will invest Rs. 1,30,043 crore during 2007-12 against Rs. 74,060 crore during the X Plan, ONGC Chairman and Managing Director, R. S. Sharma told a news conference here after the company’s annual meeting.

During 2008-09, the company will invest Rs. 19,338 crore, a 10 per cent increase over the previous year’s Rs. 17,651 crore. “Improving the reserve replacement ratio by intensifying exploratory efforts is company’s first priority. Improving recovery factor, arresting decline in mature fields and expeditious development of discovered fields are the other priorities,” Mr. Sharma said.

The corporation, in the April-June quarter, earned $123 a barrel on crude it produced but it got only $69.14 a barrel after paying for subsidies. In the July-September quarter, when oil prices have fallen but the rupee had depreciated against the dollar, its net earnings would remain at almost the Q1 levels, he said.

The corporation declared Rs. 14 per share final dividend for 2007-08, which was over and above the Rs. 18 per share interim dividend announced in December.

Mr. Sharma also said that the corporation would invest over $5 billion in developing gas finds in the Eastern offshore Krishna Godavari basin blocks. Gas from these blocks would begin flowing in 2013. Earlier, production was envisaged to start in 2011.

“Non-availability of deep-sea drilling rigs has impacted our plans. No deep-sea drilling rig was available anywhere in the world for hire before 2010. The lead time to building new ones is three years,” he added.

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