Oil India to miss MoU targets

  • 03/04/2008

  • Financial Express (New Delhi)

Oil exploration and production major Oil India Limited (OIL) has informed the oil ministry that the company would not be able to meet the MoU targets for this year due to environmental problems. In a recent meeting with the oil ministry, OIL expressed concern about the shortfall in production against MoU targets for 2007-08. This is despite OIL achieving a highest ever daily production of 3.48 MTPA this year, against 3.11 MTPA on March 31, 2007. According to sources, Oil India's target for the year 2007-08 is 3.50 MMT, including in country and overseas production. The petroleum ministry has also asked OIL to provide details of improved quantity of crude oil and natural gas, the recovery rate this year, as well as the recovery rate achieved last year. Earlier, OIL reported six small-sized oil and gas discoveries in 2007-08, but the company has not indicated any timeline for bringing these discoveries under commercial production. In this regard, the oil ministry asked the company to indicate this separately. In natural gas production, only 74% (total target of approx 2,629 MMSCM) of the target in Q3 has been achieved. However, OIL informed that they are exploring the possibility to employ LNG technology to convert gas into LNG. Similarly, on the basis of OIL's performance report, senior officials of the oil ministry expressed concern regarding 2D and 3D surveys. According to sources, both 2D and 3D surveys were abysmally below, at 40% and 16% of the target in its third quarter. The ministry also asked OIL to review the entire process involved in taking up seismic surveys and take the necessary corrective action to achieve MoU targets. On issues related to exploration, the ministry asked to submit the details of delay on account of environmental clearances and statutory delays duly vetted and certified by the director general of hydrocarbons (DGH).