Newswire — India’s largest oil and gas field, located off the country’s west coast, is set for a major output surge, as energy giant BP commits to ramping up oil production by 44% and gas output by a staggering 89%. This development comes under a decade-long contract, according to the Oil and Natural Gas Corporation (ONGC), the operator of the block.
On Wednesday, ONGC named BP as its technical service provider, tasking the global energy leader with deploying cutting-edge recovery technologies to enhance production. The baseline crude output from the Mumbai High field currently stands at 45.47 million metric tons, while gas production is at 70.40 billion cubic meters (BCM). BP’s projections target an increase in oil production to 65.41 million tons and gas output to 112.63 BCM, signaling a transformative leap for India’s energy landscape.
The Mumbai High field, discovered in 1974, has been a cornerstone of India’s energy sector but faced challenges as a mature reservoir. BP’s expertise in advanced recovery techniques and reservoir management is expected to revitalize the field, with Shell also vying for the tender but falling short.
National energy ambitions
As the world’s third-largest oil importer, India has long sought to reduce its dependence on imports by boosting domestic production. ONGC’s initiative aligns with this goal, as the increase in output is expected to begin in the fiscal year starting April 1, 2025. Full-scale production visibility is anticipated by 2027-28.
The economic benefits are significant. Incremental oil and gas production could generate up to $10.30 billion in additional revenue for India, with royalties, cess, and other levies contributing another $5 billion to government coffers.
BP will initially receive a fixed fee for its services during the first two years. Afterward, it will earn a share of the net incremental production revenue, post-recovery of costs. This performance-linked arrangement underscores the collaborative approach between ONGC and BP in maximizing returns from the field.
The Mumbai High field once reached peak oil production of 471,000 barrels per day in March 1985. However, by April 2024, output had dropped to approximately 134,000 bpd, reflecting the challenges of aging infrastructure and reservoir depletion. BP’s involvement is poised to reverse this trend and restore the field to higher productivity.
This collaboration marks a critical step in India’s journey toward energy self-sufficiency, leveraging global expertise to unlock the untapped potential of its largest oil and gas field.
