It is currently sourcing the required diesel from oil companies
Kakinada: The Oil and Natural Gas Corporation Limited (ONGC) is likely to set up a bio-diesel plant at Vodalarevu, to initially meet the energy requirements of its rigs and cater to external demand later.
ONGC is currently sourcing the entire diesel needed to operate its off-shore rigs from the oil companies.
The proposed bio-diesel plant will bring down the cost being incurred by ONGC’s on buying diesel from outside. The plan is, however, at a conceptual stage as the modalities have to be worked out before seeking the necessary clearances, according to ONGC Kakinada Eastern Offshore Asset (EOA) Executive Director K Anjaneyulu.
The ONGC has already acquired about 300 acres at Vodalarevu to create infrastructure for EOA and the idea is to take up high-yielding bio-diesel plantations there if the project is found to be feasible but a whole lot of issues have to be sorted out first.
The EOA has got Rs 1,092 crore and Rs 3,774 crore allotted for it in 2009-10 and 2010-11 respectively.
The capital expenditure plans are bound to increase further as more projects are to be added in the next nine to 11 years.
The ultra-deep off-shore projects are poised to become reality in less than a decade as ONGC is aggressively expanding its operations in Krishna-Godavari basin.
The G1/GS-15 project has been revived after initial hiccups, with an estimated investment of $ 450 million. It is expected to be ready for production in the middle of 2011.
Peak oil and gas production rates from this project will be 9,300 barrels per day and 1.6 million metric standard cubic meters per day (MMSCMD) The peak gas production from Project Manik is going to be 5 MMSCMD. The cost of this project is $ 1 billion.Gas production from Project Vasishta is expected to be 15.775 billion cubic meters at a peak rate of 5.75 MMSCMD. The ONGC’s Institute of Reservoir Studies has estimated about 10 MMSCMD gas potential over the next three to four years, 20 MMSCMD and 50 MMSCMD over the subsequent 6 – 8 and 9 – 11 year periods.