Page 6 - AsianOil Week 47

AsianOil SOUTH ASIA AsianOil
ONGC ends shale exploration programme early
PROJECTS & COMPANIES
INDIA’S hopes of replicating the US’ shale gas revolution received a heavy blow this week after state-run Oil and Natural Gas Corp. (ONGC) reportedly ended its shale exploration pro- gramme early.
ONGC has told the government that it intends to halt its exploration programme just half way through its 10-year timeline, local busi- ness daily Economic Times said on November 25, citing unnamed company sources and gov- ernment officials.
The company is also understood to have advised the government of the need for an inde- pendent international assessment of the coun- try’s shale potential.
“The US has Permian shale while India has much younger, tertiary shale. The US shale rocks are brittle and so easier to [hydraulically facture] while those in India are elastic with more clay content, resulting in little yield from fracking,” the paper quoted one executive as saying. “The general assessment after drilling wells and data analysis was that it may not be a productive idea to sink more capital into shale projects.”
ONGC had spent INR6-7bn ($84-98mn) on drilling 26 wells across the Cambay, Krishna
Godavari (KG) and Assam-Arakan basins, the sources added.
The company’s findings, the paper said, had prompted the government to consider a new assessment programme for the country’s uncon- ventional resources including shale and coal-bed methane (CBM).
In 2013, the Ministry of Petroleum and Natural Gas awarded shale exploration permits to ONGC and state-run Oil India Ltd (OIL). ONGC received 175 blocks while OIL was granted 15. Years of exploration, however, have failed to deliver tangi- ble results. Despite the government introducing a new licensing model in 2016, which oversaw a raft of upstream reforms including the move to a single licence covering all hydrocarbon exploration and production, results failed to materialise.
In January, upstream regulator Directorate General of Hydrocarbons (DGH) reportedly met with private sector and government repre- sentatives to call for greater exploration of the country’s shale potential.
“The idea is to bring shale on the map of India or just close the chapter once and for all within three years,” an unnamed company executive told the Economic Times at the time.™
SOUTHEAST ASIA
Petronas says RAPID is on track despite reports
Petronas says that its integrated downstream facility in Johor is on track to come into operation by the end of the year despite reports that it would not do so until mid-2020
COMMENTARY
MALAYSIA’S state-owned Petronas has down- played a recent report that its integrated down- stream complex in southern Malaysia is running behind schedule.
Petronas told Reuters on November 20 that its Pengerang Refining & Petrochemical Co. (PRefChem) project was on track to start up before the end of the year. The state major noted that the development’s atmospheric residue des- ulphurisation (ARDS) unit would come online in the middle of 2020.
Platts reported on November 13 that a fire at the ARDS unit in April would delay commis- sioning of the entire complex until the second
half of 2020. The news service cited comments made by Saudi Aramco, which is a partner in the project, in its initial public offering (IPO) prospectus.
PRefChem is part of the broader Refinery and Petrochemical Integrated Project (RAPID), which is a 50:50 JV between the two companies in Pengerang in the southern state of Johor. “Pet- ronas would like to clarify that its [Pengerang Integrated Complex (PIC)] is in the middle of start-up activities and expected, as planned, to beincommercialoperationsbyendof2019,”the company said in an email to Reuters.
The $27bn PIC is made up of a 300,000 barrel
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w w w . N E W S B A S E . c o m Week 47 27•November•2019