Bid & Tender
ONGC Likely to Relinquish Coal Bed Methane Block in West Bengal

Date : Sep 21, 2017

Oil and Natural Gas Corporation plans to relinquish its coal bed methane (CBM) block in Raniganj, West Bengal, but is on course to produce gas from another CBM block in Bokaro in February, a senior executive said.


It would be difficult to develop the Raniganj North block since an air strip is coming up on the same land, Ved Prakash Mahawar, director (onshore) of ONGC, said. The company evaluated the feasibility of lateral drilling to tap gas underneath the air strip, but it was found that this was not possible, Mahawar said.


ONGC has stakes in three other CBM blocks in Bokaro, Jharia and North Karanpura.


Of the total nine CBM blocks allocated to ONGC, five have already been relinquished due to poor output potential.


It plans to produce first gas from its Bokaro block in February.


“Nine sites are ready for drilling at Bokaro. Rigs will be deployed in October,” said Mahawar.


Land acquisition for the project is in progress with ONGC purchasing or taking land from owners on long lease.


A key contract to build gas gathering station has been awarded and is expected to be ready by mid-2019. A peak production of 7 lakh cubic meters a day is expected from the field.


Recently, the government freed up pricing for CBM.


ONGC is finalising a marketing plan for its output from Bokaro, he said.


The development of Jharia block has been delayed due to confusion over development rights: Steelmaker SAIL has the right to mine coal in the area while ONGC has the license to produce CBM from the same block. The two companieshave now sorted this out and a formal agreement will be signed soon, Mahawar said.


ONGC would first draw CBM from the block after which SAIL will mine coal, according to the understanding reached between the two firms.


The Jharia block already has some incidental production of 5,000 cubic meters a day, which is bottled and sold to customers.


But for the commercial development of the block, the company is preparing a feasibility report.