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The two nations plan to draw up a joint strategy for sourcing crude oil from the international market.
An ONGC Ltd.-led consortium is chasing hydrocarbon leads in the shallow waters of the MB-OSN-2005/1 Block, located in the Mumbai Offshore Basin near Saurashtra, after two exploration wells hit oil and gas.
The companies plan to invest about US$4 billion to develop natural gas discoveries in the Bay of Bengal’s KG-D6 Block.
An infill drilling program will kick off the plan’s launch in second-half 2018 followed by installation of a 12-well slot platform in first-half 2019.
The treaty signing in New York on March 6 marked the first conciliation under the U.N. Convention on the Law of the Sea—a process UN Secretary-General António Guterres said could offer other countries a path toward resolving contentious maritime boundary disputes.
Half of the spending will go toward E&P activities as the country aims to increase domestic oil and gas production.
The Indian federal government intends to change the definition of petroleum in guidelines to include this resource.
The country seeks to attract US$40 billion investment in its E&P sector over next five years.
Several major E&P projects have come online in Malaysia and Indonesia in recent times, including Sapura Energy’s SK 310 B15 gas field and Eni’s Jangkrik Complex development.
The state-owned explorer faces challenges to produce gas from its UD-1 discovery in the Bay of Bengal.
The state-run company has increased its gas production by 10% in the last three years, but that is expected to rise.
Global oil discoveries fell to a record low in 2016 as companies continued to cut spending; however, ONGC continued to spend to help achieve India’s targeted reduction on imports.