Hello and welcome to this special broadcast on the eve of Advantage Assam 2.0. My guest today is Dr. Ranjit Rath, Chairman and Managing Director of Oil India Limited and Chairman of Numaligarh Refinery Limited, one of the top geoscientists of the country. Dr. Rath is an alumnus of IIT Bombay and IIT Kharagpur. Dr. Ranjit Rath, welcome to this special broadcast.
Thank you very much. It is a pleasure having me here. I'm so glad to be part of your discourse. Let me tell you, first of all, the excellent initiative being taken by the honorable CM of Assam in terms of offering to the whole world the advantage of being in Assam. We are so glad that the honorable PM is going to inaugurate this event. We are putting up an excellent stall of Oil India and NRL to showcase what Oil India and NRL is doing not only in the state of Assam but for the entire East and the country at large. Answering your question, the kind of spectrum that Assam offers today, the opportunities are phenomenal. It's very natural that we will continue to have more such opportunities. Given the fact that Northeast Assam has been the first discovery of oil in this part of the globe, and given that India with 140 crore people, the hydrocarbon story continues to be the mainstay. With 250 million metric tons of refining processing happening, we would always continue to be an energy hungry country. With Assam having so much beautiful resources of oil and gas, we strongly feel Oil India and NRL will have the major anchor role to play in the state of Assam and in Northeast. While Numaligarh Refinery is under capacity expansion from 3 million tons to 9 million tons, Oil India is on a growth path of not only enhancing production but also doing more deeper drilling as part of our exploration campaign.
Absolutely. Now when you talk about the new avenues that Oil India Limited itself is going into, I understand that Oil India Limited has achieved some kind of a major breakthrough in Assam. You have discovered oil in the North Bank of the Brahmaputra, which is something new because so long you have been doing it only in the South Bank of the river. Tell me something about that. That's a big, big thing.
First of all, let me tell you, as a petroleum sector, we are very, very elated with it. But I will not say that this is a discovery per se. Technically, it is establishment of a report of hydrocarbon in Northeast in the North Bank of Brahmaputra because testing of flow rates, testing of the resource position, testing of the reserve position has to be done in terms of declaring it as a discovery. However, given the efforts over a sustained period, this has opened a new vista of exploration. We have drilled a well of 4,400 meters in the North Bank of Brahmaputra. As we know, the entire South Bank has lots of discoveries and producing fields, but we have established hydrocarbon. We are following it up with more well drilling in the North Bank to establish, and possibly it will be one of the good discoveries, but time will tell.
Now this is a very interesting thing that you said. You are drilling 4,400 meters. When oil was discovered here more than a century ago, you used to go only about 50 to 100 meters deep. So from that point, you have come to 4,500 meters. So that is technology speaking itself, isn't it?
I'm so happy that you are asking this question. I want to tell the entire audience, when it started in 1889, that was the first well we drilled in Digboi and we discovered at a depth of about 50 meters. Today, as we speak, we are producing from our Machi 6 field at 5,400 meters. Oh my God, Machi! We have established hydrocarbon in huge stacks of sandstone with natural gas at 5,700 meters. We have drilled the deepest well in this part of the globe, 5,800 or 5,900 meters in Sadiya, and we aspire to go deeper.
Absolutely, very nice to hear that. Now obviously my follow-up question will be: what about the possibility of establishing — I will use your word — establishing hydrocarbon on the bed of the Brahmaputra?
Absolutely, you are bang on. That's what the geologist in me tells. If you have so prolific South Bank of Brahmaputra and we have established hydrocarbon, it's but natural we would tend to believe that there is hydrocarbon beneath the Brahmaputra bed. Therefore, Oil India Limited has now adopted two more additional technology-driven drilling campaigns. One is called extended reach drilling, wherein we will target below the Brahmaputra bed by drilling vertically and then horizontally so that the ecosystem or ecology of that particular sensitive zone is not disturbed. Similarly, this is a breaking story: Oil India Limited is going to look for oil on the bed of the Brahmaputra. Yes, time will tell. We are going to drill ER well further to reduce the footprint of our drilling efforts. We have also initiated a campaign called multilateral drilling, where from a single platform we are going to drill three to five wells, and all the wells can be operated. The letter of award has already been given, so in Baruri we are going to adopt it.
Right. Now you see, you are a very passionate oil man. Now my question to you is: how do you reflect 1889, more than 100 years ago oil was found in Assam, and today we are sitting here talking about drilling to establish or find hydrocarbon under the Brahmaputra river bed? How do you reflect?
Thank you very much for that passionate term. You are gracious enough. We strongly believe that Oil India Limited has got the best of the assets in this part of the globe. Assam itself, which is the Category 1 Basin, is the number one out of those seven basins. It's prolific, and I must salute all those indomitable spirit explorers who established discoveries and discoveries by drilling deeper. So when we established hydrocarbon and we are producing today from the Eocene formations from the Langpar, Thea, as they call it, we are now targeting deeper horizons and we have been successful. We have been successful in Machi, successful in Kusijan, and we are going to drill the Sadiya well. That's our effort, and we are hopeful of striking more resource positions and more reserves for India.
Right. Now talk about Oil India Limited. You have about a year ago, you have got the status of a Maharatna company, a Navratna company. Now Oil India Limited last fiscal registered a growth of about 5.5 to 6%. Yet India continues to be heavily dependent on oil imports. Now you have set a target of only 4 million tons of crude oil and about 5 billion cubic meters of gas. Don't you think you have a lot to go?
We have a lot to go because there are two things which come in the way. These are all mature fields. We have been producing from these fields for 60-70 years, so there is a traditional conventional decline which happens in production. That decline is about 10 to 12%. So when Oil India as an E&P company reports a growth story of 5%, that means on top of the decline, it reports 5%. Therefore, the aspirational target of 4 million metric tons of crude oil — I'm using the term aspirational — but as we drill deeper, we would definitely reach there. The gas story is a bit different. As I speak, additional infrastructure development is happening. Indradhanush Gas Grid is getting connected from the source to the consumers. So with more infrastructure coming in, we are going to have more gas wells. I must tell, since I'm speaking on the eve of Advantage Assam, as part of our commitment to the Northeast, for BCPL, Oil India is targeting to drill 15 deeper wells to ensure availability of rich gas. That's our gas story. Also, the government of India has brought out a beautiful policy wherein as national oil companies, whether it is ONGC or Oil India, we would get a premium of 20% on the price of gas which is $6.5 per mmBtu for new gas. We are doing well. This allows us to experiment and explore deeper.
