ONGC plans $11 B asset upgradation
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ONGC plans $11 B asset upgradation

By agencies   |   Tuesday, 29 November 2005, 08:00 Hrs
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NEW DELHI: India’s largest integrated oil company, ONGC is planning a massive upgradation program of its assets that will be worth $11 billion at Mumbai offshore and covering offshore platforms, pipelines and ships slowly being replaced, a newspaper said.

¬ďAll assets over 25 years of age will be replaced over the next five years. Older facilities require more time and effort for operation, while newer facilities have greater reliability,¬Ē said SC Gupta, chief engineering services, ONGC.

ONGC is now awarding contracts worth millions of dollars to contractors and suppliers almost every week. Contracts worth roughly $410 million are being awarded this week. A letter of intent for the production of eight-wellhead platforms worth $190 million was awarded to the Abu Dhabi based NPCC, the Economic Times said.

Indian construction major L&T has bagged a $219 million order for four well head platforms. Earlier this year, L&T bagged a project of $423 million for replacement of pipelines from ONGC as a part of a consortium.

Bombay High, which accounts for over half of ONGC’s crude oil production, will account for a lion’s share of ONGC’s total budget for the current year on account of these projects. The paper said quoting company sources that contracts worth $1.93 billion are being executed while another $1.13 billion worth of projects are under tendering.

Apart from new platforms, a $75 million contract has been awarded for the revamping of 26 old platforms. About 400 km of sub-sea pipelines are being replaced on a rolling basis. ONGC has 33 process platforms and 142 well-head platforms in Bombay High. In addition, about 4,300 km of sub-sea pipelines connect these platforms to each other and to the shore, the paper said.

The company will be replacing these at the rate of 4-5 platforms annually. Wellhead platforms pump out the oil and gas, which is then sent to the process platform for separation. ONGC operates over 100 vessels including offshore service vessels, platform supply vessels, drillings ships, rigs etc.

Many of these ships are nearing their replacement age. ONGC owns about 40 percent of the total fleet that will be replaced over the next 4-5 years. ONGC is also in touch with some private sector Indian shipping companies that could acquire these ships that could then be taken on long-term charter by ONGC, the paper said.

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