BP, which was picked as a technical service provider to help India raise production from its largest oilfield, has indicated that oil output at the Mumbai High offshore field could be increased by 44% and gas production by 89%, the field operator said on Thursday.
On Wednesday, India’s state-held Oil and Natural Gas Corporation Limited (ONGC) announced it had hired supermajor BP to be the technical service provider of its efforts to boost production at India’s biggest oilfield, Mumbai High in the Arabian Sea, around 100 miles west of the Mumbai coast.
Mumbai High hit peak production of 471,000 barrels per day (bpd) of oil in March 1985. Output has now declined, to around 134,000 bpd last year.
BP has indicated a substantial potential increase of about 44% in crude oil and around 89% increase in gas production for the ten-year contract period, ONGC said in a stock exchange filing on Thursday.
The increase is expected to be visible from the financial year 2026 onwards, with full-scale visibility expected from FY 2028, India’s largest exploration and production firm said.
This incremental production is expected to generate additional oil and gas revenue (net of levies) of up to $10.30 billion, and incremental contribution to the government of India of up to $5 billion, ONGC said.
BP, as the technical service provider, will receive a fixed fee for the first two years, followed by a Service Fee based on a percentage share of the revenue from net incremental hydrocarbon production, after recovering incremental costs.
India has been looking to increase its domestic oil and gas output in a bid to reduce its high dependence on imports. Currently, India, the world’s third-largest crude oil importer, relies on imports to cover more than 80% of its daily consumption of oil.
BP, for its part, has been present in India for decades and has been looking to boost its presence in both the upstream and downstream sectors in the country which is replacing China as the key driver of global oil demand growth.
By Tsvetana Paraskova for Oilprice.com