| East ahoy!
New Delhi, Jan. 19: Upstream oil companies ONGC and Oil India Ltd (OIL) will be investing Rs 6,688 crore in exploration and production in the northeastern states during the five-year period ending 2007. These investments are expected to raise the crude output in the region from five million tonnes a year to six million tonnes.
Petroleum ministry sources say OIL has chalked out a Rs 4,115-crore plan, while ONGC will be channelising Rs 2,573 crore into the region.
The money will be spent on 2-D and 3-D seismic surveys and the drilling of exploratory and development wells.
There is serious concern over the decline in crude output from the northeast states and the actual output has fallen short of the projected rates.
Investments in setting up the Numaligarh refinery and the expansion of the Bongaigaon refinery were made on the basis of these higher estimates of crude availability. The crude output in the region has now fallen short of the amount required.
The oil companies have informed the petroleum ministry that exploration and production activities in the northeast are being frequently disrupted due to bandhs and blockades. Miscreant activities have also been on the rise and oilfield equipment and pipelines have been damaged.
According to the oil companies, these “environment” problems not only hit production directly but also slow down exploration work.
Instances such as the recent extremist attack on ONGC officials result in demoralising the teams which have to work in remote areas.
The oil firms have brought to the government’s notice the frequent agitations by unemployed youth in the operational areas during award of contracts for drilling and other services.
Amongst the more serious instances has been the blockade at OIL’s recently discovered Khagarijan oilfield. The residents of Rohmoria village are reported to have raised the demand for the construction of a river embankment which has resulted in the suspension of production since August 1999. Despite several attempts the issue still has not been fully resolved.
Nagaland is another area where ONGC’s exploration and production work has been completely suspended since 1994.
Apart from these troubles and the shortage of power supply, there have been problems related directly to the oilfields. The decline in the output of some of the fields, for instance, has been higher than anticipated.