ONGC Starts Output From Wells at India's Biggest Oil Field as Spill Stops
Oil & Natural Gas Corp., India’s largest energy-exploration company, started production from wells at the nation’s biggest oil field that were shut early today after a pipeline leakage off the west coast.
The leakage of oil has stopped, ONGC said in an e-mailed statement today. Production has resumed from Mumbai High through an alternative pipeline, according to the release. The explorer earlier said production may be halted for three hours.
“A three-hour stoppage in production and the volume of loss doesn’t look like it will impact ONGC much,” said Niraj Mansingka, a Mumbai-based analyst at Edelweiss Capital Ltd.
The state-run explorer said it may have lost 25,000 barrels of crude oil. The spill, about 80 kilometers off the Mumbai coast, was spotted at 8:45 a.m. local time and was estimated to be about one mile (1.6 kilometers) long, ONGC said.
ONGC shares declined 2.5 percent to 1,105.55 rupees at close in Mumbai, the lowest level since May 26. The benchmark Sensitive Index fell 0.2 percent.
The Coast Guard has withdrawn an oil spill contingency plan that was aimed at minimizing damage to the environment, ONGC said. The spill may be dispersed within 48 hours, according to the statement.
ONGC didn’t say what caused the leak in the pipeline, which has a capacity of 212,000 barrels a day.
ONGC Chairman R.S. Sharma didn’t answer a call made to his mobile phone or respond to a text message seeking comment. Sudhir Vasudeva, director of offshore services, couldn’t be reached after three calls to his mobile phone.
The Mumbai High block off India’s west coast produced 1.4 million metric tons of crude, or about 336,000 barrels a day, in November and accounts for about 42 percent of the company’s output, according to oil ministry data.
India’s government plans to sell a 5 percent stake in the explorer in March, Disinvestment Secretary Sumit Bose said today.
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