India’s state-run Oil and Natural Gas Corp (ONGC) will make a $1bn investment in eastern offshore oil discoveries to begin production by mid-2010, according to Indian officials.

ONGC is expected to implement cluster development of oil discoveries in GS-29, G-4-6, and G-4-5 shallow water blocks and discoveries in the KG-DWN-98/2 deepsea block.

ONGC will use the same model deployed by Reliance Industries for generating oil from the adjoining gas-rich KG-D6 or KG-DWN-98/3 block, ONGC offshore director Sudhir Vasudeva was quoted as saying by Indian publication Business Line.

Initially oil output could reach 8,000 barrels of oil a day, according to ONGC.

The company also aims to tie up ten gas finds in KG-DWN-98/2 with the GS-4, G-29 and Vashistha gas discoveries in a KG-OS-DW4 shallow water block in the same KG basin.

Vasudeva added that production of gas may commence by 2013, with the Vashistha and adjoining S-1 fine alone generating nearly 6 million standard cubic metres a day of output.

The integrated project’s total gas production is estimated at 25mmscmd.