'Poor water injection by ONGC cost Rs 11,276 cr in crude oil loss'

New Delhi: Pulling up Oil and Natural Gas Corporation (ONGC) for the loss of 3.8 million tonnes of crude oil in four years, the Comptroller and Auditor General of India (CAG), in its report, said that India lost 3.8 million tonnes of crude oil worth of Rs 11,276 crore in four years due to less than planned water injection by ONGC in its western offshore fields.

"Water injection in the field was affected due to aging of injection infrastructure, frequent pipeline leakages due to poor quality of injection water, non-implementation of feasibility report inputs and to some extent, production from high gas-oil ratio wells," said the CAG report, which was tabled in both the Houses of the Parliament on Thursday.

Notably, ONGC's aging Mumbai High, Neelam and Heera fields off the Mumbai coast have been on a decline and water is injected into wells to push out the remaining oil. "There was inadequate water injection," the CAG said, adding that this led to a drop in reservoir pressure sharply and impacted crude oil production.

"Deficient water injection impacted loss of production of crude worth Rs 7,802.50 crore for ONGC and revenue loss of Rs 3,474.29 crore to the government of India by way of statutory levies during the audit period (2014-15 to 2018-19)," it said, adding that the this loss cannot be considered as deferred production but a permanent loss of oil.

"Further, even for exploitation of a part of this oil deficit, additional investment is required and this needs review from the point of economical oil recovery," it said.

Mumbai High, Neelam and Heera fields contribute about 59 per cent of ONGC's production. The mature fields, which have been operating from 1976 and 1984 respectively, are susceptible to decline in production.

CAG further said that the shortfall in water injection is one of the significant reasons for less production of crude oil.

The crude that could not be produced due to lesser water injection was 3.79 million tonnes during the audit period.

"The value of oil deficit of 3.79 million tonnes due to less water injection worked out to Rs 11,276.79 crore. Out of this, the value of the oil deficit was Rs 7,802.50 crore for ONGC after considering the statutory levies and the balance ₹3,474.29 crore is revenue loss to the Government of India," it said.