BP tackling production decline at ‘largest and most prolific’ oil field offshore India

UK-headquartered energy giant BP has been hired by India’s state-owned energy giant Oil and Natural Gas Limited (ONGC) to handle the decline in hydrocarbon production levels at a giant oil field off the country’s west coast.

The contract award to BP comes after ONGC disclosed a tender at the start of June 2024 to find an international technical services provider (TSP) to unlock production growth from its Mumbai High field, with the bid submission due by mid-September last year. The UK oil major has been picked to serve as the TSP for the asset, seen as India’s “largest and most prolific” offshore oil field, allowing the state-owned firm to retain its ownership and operational control of the field.

Shri Arun Kumar Singh, Chairman and CEO of ONGC, remarked: “By engaging a TSP, ONGC aims to realize the enhanced potential of the Mumbai High field by leveraging cutting-edge technologies and global best practices, securing its future contribution to India’s energy landscape.”

BP will work closely with the operator to stabilize the field’s current production decline and restore it to what is anticipated to be “a robust growth trajectory.” The UK player will get a fixed two-year fee for its deployed personnel, followed by a service fee linked to incremental oil and gas production.

Shri Hardeep Puri, Minister of Petroleum and Natural Gas (MoPNG), commented: “India’s quest towards energy self-sufficiency under the dynamic leadership of Hon’ble PM Narendra Modi Ji gets a massive boost as ONGC onboards its energy partner BP as technical service provider for the Mumbai High field, landmark field which has been providing energy security to us since 1974.

“While ONGC continues to retain the ownership of the field, this unique technology collaboration with BP’s expertise in managing complex mature reservoirs and implementing advanced recovery technologies and best operational practices will help in enhancing the production from this iconic field.”

Moreover, the field’s new TSP will enhance oil recovery by conducting comprehensive reviews of sub-surface models, implementing system optimizations, and enhancing reservoir management practices. Since the duo’s partnership is anticipated to “significantly boost” domestic oil and gas production, BP believes this will yield higher service fee returns while increasing revenue for ONGC.

Kartikeya Dube, Head of country and Chairman BP India, noted:“We are extremely proud and privileged to be selected as a partner by ONGC and look forward to bringing our international experience and technical expertise to the Mumbai High field.

“This opportunity further underpins our commitment to exploration and the production of oil and gas in India, creating value for both companies and helping support the country’s vision for energy independence and security.”

Therefore, BP plans to assemble a team of technical experts to begin work by March 2025. To this end, both players have established a senior management team and joint management team to ensure seamless project execution.

Shri Pankaj Jain, India’s Secretary of Ministry of Petroleum and Natural Gas, underlined: “This strategic engagement represents a critical step in leveraging global best practices and cutting-edge technologies to optimize production at Mumbai High.

“I am confident that through this collaboration, we will reinforce our commitment to energy self-reliance and sustainable growth, ensuring a brighter future for India’s energy landscape.”

ONGC has been actively working to bolster hydrocarbon production in India. Last year, the firm held a flag-off ceremony for the first crude oil offtake from a floating production, storage, and offloading (FPSO) working at Krishna Godavari, said to be the first deepwater development in India.

This milestone was achieved a couple of months after the company confirmed the first oil from the KG-DWN-98/2 deepwater block off the coast of the Bay of Bengal.

Meanwhile, BP recently began the liquefaction process at the Greater Tortue Ahmeyim (GTA) Phase 1 development, which is perceived to be the biggest project in the UK’s energy giant’s portfolio.