Context: Recently, State-owned Oil and Natural Gas Corporation (ONGC) announced that it has begun oil production from its long-awaited deep-sea project in the Krishna Godavari basin in the Bay of Bengal. This development is expected to reverse years of declining output.

Key Details of the Project

• The Krishna-Godavari (KG) basin block KG-DWN-98/2, situated offshore in the Bay of Bengal initiated crude oil production under the flagship project of Oil and Natural Gas Corporation (ONGC).

• It is situated 35 km from the Andhra Pradesh coast in water depths of 300-3,200 meters.

• ONGC had estimated its capital expenditure at $5.07 billion and operational expenditure at $5.12 billion over a field life of 16 years.

• Cluster development approach is employed by focusing on the 2nd cluster as 2A and 2B.

Benefits

• It is expected to increase ONGC’s total oil and gas production by 11% and 15%, respectively.

• A 7% increase in India’s oil and natural gas production is anticipated after the completion of extraction in phase 2.

• The final phase targets mid-2024, with expected peak production of 45,000 bopd and over 10 mmscmd of gas.

• It is critical to India's objective of meeting growing energy needs, reducing dependence on imports, and energy self-reliance (Aatmanirbhar Bharat).

• India is the world's third-largest crude oil consumer, and imports over 85% of its requirement from Russia, Iraq, Saudi Arabia, etc.

About Krishna Godavari Basin

• It constitutes an extensive deltaic plain formed by two large east coast rivers, Krishna and Godavari in Andhra Pradesh and the adjoining areas of the Bay of Bengal.

• The basin is an Ultra-deep-water gas, and the world’s second-deepest hydrocarbon discovery.

• Petroleum System: Proven petroliferous basin of continental margin located on the east coast of India.

• Stratigraphy: It contains about 5 km thick sediments with several cycles of deposition, ranging in age from Late Carboniferous to Pleistocene.

• This is influenced by a long linear Gondwana rift valley.

• Major geomorphologic units: Upland plains, Coastal plains, Recent Flood, and Delta Plains.

• Geophysical Surveys: ONGC conducted geological mapping since 1959 using Gravity-magnetic surveys and 3D seismic surveys in on-land and offshore areas.

About Oil and Natural Gas Corporation (ONGC)

• ONGC is an Indian central public sector undertaking under the ownership of the Ministry of Petroleum and Natural Gas.

• It was founded in 1956 and is headquartered in New Delhi.

• Maharatna ONGC is the largest crude oil and natural gas Company in India, contributing around 71 per cent to Indian domestic production.

• ONGC is the only fully–integrated oil and gas company in India, operating along the entire hydrocarbon value chain.

• ONGC possesses about 15% of the total Indian refining capacity.

• It has established 8.98 billion tonnes of in-place hydrocarbon reserves.

• It has to its credit more than 570 discoveries of oil and gas with Ultimate Reserves of 3.13 Billion Metric tonnes (BMT) of Oil Plus Oil Equivalent Gas (O+OEG) from domestic acreages.

• ONGC produced 18.4 million tonnes of crude oil and about 20 billion cubic metres per day of gas in FY23.

• It contributes around 71% of India's oil and gas production.