Assam Chief Minister Seeks Transfer Of ONGC’s North East Assets To Oil India

Assam Chief Minister Seeks Transfer Of ONGC's North East Assets To Oil India

Assam Chief Minister has urged the Prime Minister to shift ONGC’s north eastern assets to Oil India

Assam Chief Minister Himanta Biswa Sarma has written to Prime Minister Narendra Modi, requesting him to consider transferring all the assets of Oil and Natural Gas Corporation (ONGC) in the north eastern region to Oil India Limited (OIL).

“Assam and Assam-Arakan basins in the north eastern region are the cradle of Indian hydrocarbon industry and are one of most prolific sedimentary basins of India. OIL and ONGC, both national oil companies are the two major operators in the region. The areas which are currently under production have been given to both the companies under nomination regime and they are the leading operators in the region,” Mr Sarma stated in a letter to the Prime Minister.

He said further in the letter that it is universally felt in the north east region, that the operations in the area may be carried out by one major operator, preferably OIL, as it was born in Assam and has commendable interaction with the local population.

“North eastern region accounts for 26 per cent of oil and 44 per cent of gas production out of the entire oil and gas production. With more focused attention, an integrated company can aspire to increase the production from 4.15 million metric tonnes to around 6 million metric tonnes of oil and from the current 4.66 billion cubic metres of gas to around 7 billiion cubic metres by 2024-25,” the chief minister wrote in the letter to Mr Modi, justifying his demand.

This, Mr Sarma said, will not only boost the energy consumption in the north east region but will also lead to a lot of industrialisation and employment generation.

“Oil India is a company rooted in the North Eastern Region and understands the nuances of the region. With more than 90 per cent of employees from the region, the company would be able to focus with undivided attention on the operations and at the same time be sensitive to the aspirations of local people,” the letter said further.

Further justifying his point, Mr Sarma has mentioned that “during 2019-20, the oil and gas production in Assam was 4.15 million metric tonnes and 3.14 billion cubic metres respectively, despite the fact that major fields operated by both ONGC and OIL are old and mature. It may be mentioned that almost the entire production of Oil India comes from north eastern region and hence the focus of OIL on exploration and production in this region is undivided”.

“With taking over of Numaligarh Refinery Limited (NRL), OIL’s net-worth has improved substantially and it has led to vertical integration. With further expanding the operational areas and production, OIL can aspire to be the only Maharatna Company of our region and would truly reflect the Act East Policy. OIL can also endeavour to create a hydrocarbon sector manufacturing and services hub in Assam which can in the long run aspire to provide services to the far eastern countries. As both the companies are national oil companies and also, as the acreages were awarded under nomination regime, no issues are envisaged in transfer of assets by transferring the nomination from ONGC to OIL. I would, therefore, request that Government of India may kindly consider transfer of all the acreages of ONGC in the region to OIL,” the letter said.

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