New Delhi: Oil and Natural Gas Corporation (ONGC) on Monday said the Ministry of Petroleum & Natural Gas (MoPNG) has informed that the application to extend the Production Sharing Contract (PSC) of an offshore block in the Cambay basin, Block CB-OS/2, “has not been accepted.” The block was awarded to ONGC, Vedanta Limited and Tata Petrodyne Ltd in 1998.
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ONGC added that it has been directed to “take control of all data, assets, operations and responsibilities” for the block in the capacity of the "Government Nominee." ONGC said it is accordingly taking over control.
The company described the move as a “purely interim measure” taken by the government “to maintain continuity of petroleum operations in public interest and safeguard petroleum reserve until the block is awarded to other party.”
Commenting on the development, a spokesperson from Vedanta said, "The contractors of the said block were ONGC, Vedanta and Invenire. ONGC was the largest shareholder with a 50 percent stake, and the remaining stake was shared between Vedanta and Invenire. The block contributed less than 0.3 percent to the overall EBITDA of Vedanta."
Block CB-OS/2 was awarded under a Pre-NELP round in August 1998. The consortium originally comprised Cairn Energy India Pty Ltd, now Vedanta, (40 percent), Tata Petrodyne Ltd (10 percent) and ONGC (50 percent), with Cairn as operator. The block was declared operational after commercial discoveries of oil and gas, and a Petroleum Mining Lease (PML) was granted in 2002, according to the Directorate General of Hydrocarbons (DGH).
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The acreage includes the Lakhsmi and Gauri fields and is currently producing about 3,400 barrels of oil per day and 3,40,000 standard cubic metres per day (SCMD) of gas.