No wonder PM Narendra Modi described the development as a “remarkable step in India’s energy journey” in a post on the microblogging site X.”This is a remarkable step in India’s energy journey and boosts our mission for an Aatmanirbhar Bharat (self-reliant India). It will have several benefits for our economy as well”.
Oil minister Hardeep Singh Puri said the project in KG-DWN-98/2 block is expected to add 7% each to India’s current production of oil and natural gas with 45 million barrels per day, or 2.2 million tonne per year, at peak production. The peak production will account for 11% of ONGC’s oil production and reverse the decline in output due to ageing fields.
The block, located 35 kms off the Andhra coast in water depths of 300 to 3,200 metres. ONGC had initially planned to start oil production from the block in November 2021, but the deadline saw multiple extensions due to delays caused by Covid-19 pandemic and geographical complexities.
The project’s first phase for gas production was executed in March 2020. At the time of the project launch in April 2018, ONGC had pegged its capital expenditure at a tad over $5 billion over a field life of 16 years.