Oil and gas exploration and production operators and national oil companies are working to attain a production level of 50 billion cubic metres (BCM) of gas and 40 million tonne (MT) of crude oil by FY24, the Union ministry of petroleum and natural gas said in a social media post.
Domestic natural gas production in FY21 was 28.6 BCM, while 30.5 MT of crude oil was produced in the country in the fiscal. Indigenous natural gas production caters to about 51% of the country’s requirements, while around 85% of the country’s crude oil is imported.
The ministry said on Twitter that Union petroleum minister Dharmendra Pradhan reviewed a presentation by the director general of Hydrocarbons on “Exploration & Production Action Plan 2023-24” where these production targets were mentioned. The minister encouraged the industry “to accelerate exploration and production activities by greater use of technology and geo-scientific data” and has “also assured all support to the operators in boosting domestic production of oil and gas for a secure energy future,” the post added.
Domestic natural gas output had fallen 2.8% year-on-year to 31.2 BCM in FY20, reversing the growth trend recorded since FY18.
However, natural gas production increased 22.7% y-o-y to 2.7 BCM in April, mainly due to higher production from Reliance Industries and BP’s ultra-deep-water field in the KG D6 Block of the Krishna Godavari basin on the east coast. Commencement of gas production at the neighbouring field owned by Oil and Natural Gas Corporation (ONGC) is also expected soon.
The current price for gas produced from local nominated fields has been revised to an all-time low of $1.79/ million British thermal units (mBtu) by the government, which is much below the breakeven point for most fields, deterring gas producers from aggressively increasing production or getting into new high-risk projects. For ultra-deep-water gas fields like the Krishna Godavari basin, which have higher pricing and marketing freedom, the current price cap is set at $3.62/mBtu.