Indian state firm Oil and Natural Gas Corporation (ONGC) plans to raise fourfold its exploration and production acreage by 2025, India’s petroleum minister said on Thursday, as the world’s third-biggest oil importer looks to reduce its large dependence on crude imports.
ONGC’s strategy for the future includes boosting the E&P acreage from the current 127,000 square kilometers to 500,000 square kilometers by 2025, Indian Petroleum and Natural Gas Minister Hardeep Singh Puri tweeted on Thursday after visiting the company’s integrated energy center in Maharatna.
The state oil firm will “also focus on green hydrogen & other sources of enhancing domestic petroleum & natural gas production in the country which will contribute in reducing the fuel import bill,” the minister added.
ONGC accounts for around 75 percent of India’s oil and gas production, while its long reserve life of 15 years provides visibility on future cash flows and is comparable to that of ‘A’ rated peers, Fitch Ratings said in a report on the company earlier this month. Fitch has a ‘bbb+’ standalone credit profile (SCP) rating on ONGC.
The company’s chairman Subhash Kumar told local outlet The Tribune in an interview this week that the Himachal Pradesh state in northern India had “immense potential in oil and natural gas exploration.”
In recent months, India has not been happy with its import bill as its economy and refiners are more sensitive to international crude oil prices than some other oil-importing nations. India, where imports meet more than 80 percent of oil demand, is one of the large oil consumers that has repeatedly called on OPEC+ to increase oil production more than planned in order to cool the rally in prices.
Last month, reports emerged that India was looking to boost its domestic oil production by asking ONGC to weigh a potential sale of majority stakes in two large offshore oil and gas fields.
In October, India’s petroleum ministry secretary Tarun Kapoor told Reuters that U.S. supermajor ExxonMobil was in talks to potentially invest in some of ONGC’s deepwater exploration assets off India’s east coast.