$20 billion bet: ONGC eyes its oil exploration programme with deep-water drilling rigs; eye on energy security

Oil and Natural Gas Corporation or ONGC is expected to spend about $18–20 billion on hiring deep-water drilling rigs for what could become its largest-ever oil exploration programme, according to people familiar with the development.Last month, ONGC floated a tender for these rigs as it looks to accelerate hydrocarbon exploration under the government’s Samudra Manthan mission, which is aimed at strengthening the country’s energy security. Around a dozen domestic and global drilling firms took part in a pre-bid meeting held in Mumbai on March 20, sources said.“The tender seeks a mix of drill ships and semi-submersible rigs for up to five years. This programme will cost ONGC around $18-20 billion,” a senior industry official whose company attended the meeting told ET.“ONGC is seeking mobilisation of the rigs within 80 days, which highlights ONGC's urgency to scale up deep-water activity,” the industry official added.Apart from operations in the KG Basin along the east coast, ONGC has also initiated ultra-deep-water drilling in the Andaman region. The company is also exploring partnerships with global energy majors such as BP, ExxonMobil, TotalEnergies and Petrobras as part of its strategy to reduce risks that are associated with exploration in capital-intensive frontier areas. The tender that was issued in February invites bids from experienced offshore drilling contractors. This tender invites bids through an international competitive bidding process.Though the tender was issued in February, the news assumes significance at a time when India’s energy is particularly in focus with the Middle East conflict and the US-Iran war disrupting flows of crude oil, LPG, and LNG.