British energy giant BP has pledged to increase oil production by 44% and gas output by 89% from India’s largest offshore field under a decade-long contract, according to an announcement by block operator Oil and Natural Gas Corporation (ONGC) on Thursday.
ONGC appointed BP as its technical service provider on Wednesday after a competitive tender process. BP will focus on deploying advanced recovery technologies and managing mature reservoirs to reverse the production decline from the Mumbai High field. The baseline production levels stand at 45.47 million metric tons of crude and 70.40 billion cubic meters (BCM) of gas.
The Mumbai High field, discovered in 1974, was once a major contributor to India’s energy production, reaching a peak crude output of 471,000 barrels per day (bpd) in March 1985. However, production declined to around 134,000 bpd as of April 2024. Under BP’s guidance, oil production is projected to rise to 65.41 million tons, while gas output is expected to increase to 112.63 BCM.
Shell also participated in the tender but was not selected. The tender process emphasised the need for expertise in enhanced oil recovery and reservoir management, given the field’s maturity and complex geology.
The increased output is expected to contribute significantly to India’s energy security, with potential additional oil and gas revenues of up to $10.3 billion over the contract period. Contributions from royalties, cess, and levies could add as much as $5 billion to government revenues, ONGC stated in its exchange filing.
India, the world’s third-largest oil importer and consumer, has been striving to increase domestic energy production amid stagnant output levels in recent years. The partnership with BP represents a key step toward achieving the government’s goal of reducing dependence on energy imports.