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OVL Output Slides on Unrest in Sudan, Syria

  • The first-ever drop comes at a time when its parent company, ONGC, is also battling declining output from its ageing fieldsONGC's overseas exploration arm ONGC Videsh Ltd (OVL) will see its first-ever decline in production this year on account of geopolitical factors in Sudan and Syria. In the first three quarters of the current financial year, the company's production dropped over four per cent to 6.76 million tonnes of oil and oil equivalent gas against 7.06 million tonnes in the corresponding period last year. The company, with nine producing assets overseas, had achieved a record production of 9.44 million tonnes last fiscal. However, this year the company may even miss the target of nine million tonnes given by the petroleum ministry.

  • The drop will come at a time when its parent company, ONGC, is also battling declining output from its ageing fields. ONGC has seen crude oil production drop from 25.4 million tonnes in 2008-09 to 24.4 million tonnes in 2010-11. ONGC had taken up 21 improved oil recovery (IOR), enhanced oil recovery (EOR) and redevelopment projects in 15 major fields. Of these, 15 projects have already been completed and six are under implementation. By the end of last financial year, cumulative expenditure on IOR/EOR and redevelopment projects stood at Rs 25,797 crore. In the six ongoing projects, the likely investment is expected to be Rs 8,300 crore.

  • According to an OVL official, production has suffered primarily in Sudan and Syria. Sudan was divided into North Sudan and South Sudan. "There are issues between the two sides that have not been resolved. While most of the production comes from landlocked South Sudan, infrastructure like pipeline and processing facilities lie in North Sudan. The North is seeking tariffs, which are not agreeable to the South. This has affected our production," he said. Against regular production of 130,000 barrels per day (bpd), the current production is around 60,000 bpd. OVL gets a 25 per cent share in the production.

  • Output at OVL's Syrian assets has fallen due to sanctions imposed by the European Union on the country's oil exports. "Against an earlier production of 80,000 bpd, production now stands at 20,000 bpd. OVL has a 13.5 per cent share of produce from these assets," the official said.

  • OVL produces hydrocarbons from nine assets overseas — Russia (Sakhalin-I and Imperial), Syria (Al-Furat Project), Vietnam (Block 06.1), Colombia (Mansarover Energy Project), Sudan (Greater Nile Oil Project and Block 5A), Venezuela (San Cristobal Project) and Brazil (BC-10).

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