Shell and Reliance Industries will return the Panna-Mukta oil and gas fields back to India’s state-owned Oil & Natural Gas Corporation (ONGC) after operating them for 25 years.
In the Panna-Mukta and Tapti (PMT) joint venture (JV), ONGC holds a 40% stake, while Reliance Industries and Shell India-owned BG Exploration & Production India (BGEPIL) own 30% stake each. The production sharing contracts (PSC) for the PMT fields were executed by the PMT JV with the Government of India in 1994 and are supposed to expire on 21 December 2019.
Located in the Arabian Sea off the Mumbai coast, the PMT oil and gas fields were awarded to a consortium of US-based Enron and Reliance Industries in 1994. ONGC, which originally discovered the fields, served as a government nominee with 40% back-in rights in the fields.
The Panna-Mukta oil and gas fields have produced an average monthly production of approximately 10,000 barrels per day (bpd) of crude oil and 140 million standard cubic feet per day of natural gas (mmscf/day) in 2019.
During its bankruptcy, Enron was taken over by BG Group of UK in 2003 and the latter’s stake in the fields was subsequently taken over by Shell in 2016.
BGEPIL managing director Trivikram Arun said: “The PMT JV is a great example of a successful partnership between India’s largest National Oil Company (ONGC), India’s largest private company (Reliance) and an International Oil Company (Shell).
“Shell is proud to have been part of this journey and privileged to have partnered with Reliance, ONGC and the Government of India.”
Currently, decommissioning and site restoration of residual Tapti facilities are being carried out by the PMT JV under India’s first offshore Decommissioning & Site Restoration project. According to Reliance Industries, the Tapti Decommissioning and other commercial activities would continue in BGEPIL even after returning the PMT fields back to ONGC.