Bengaluru

State-owned oil company ONGC has commenced "first oil" production from Krishna Godavari Deep-Water Block 98/2 in the Bay of Bengal, marking new crude discovery in the country.

The place where the oil is extracted is 30 kilometres off the coast of Kakinada in the Krishna Godavari basin.

"I am delighted to inform all my fellow countrymen that the first oil was extracted yesterday (by ONGC). Work has started on this in 2016-2017, and there were some delays on account of Covid," Union Petroleum Minister Hardeep Puri told reporters on Monday.

He said four of 26 wells are already operational and the production is expected to touch 45,000 barrels per day by May or June, which will be 7 per cent of our total crude oil production

"I am sure that out of the 26 wells there, four wells are already operational. We will not only have gas also in a short period of time, but by May or June we will hope to able to produce 45,000 barrels per day, which will be 7 per cent of our total crude oil production and 7 per cent of our gas production," he added.

Phase 3, leading to peak oil and gas production from the basin, is already underway and likely to be over in June 2024. The 98/2 project is likely to increase ONGC's total Oil and Gas production by 11 per cent and 15 per cent respectively.

India, the world's third-biggest oil importer and consumer, is dependent on crude oil from various sources in the global market to meet its domestic demand.

"ONGC commenced its 'First Oil flow to FPSO', from Krishna Godavari Deep-Water Block 98/2 (in Bay of Bengal) on 7 January 2024, nearing completion of Phase-2 of the project. Phase-3, leading to peak Oil and Gas production, is already underway and likely to be over in June 2024. The 98/2 project is likely to increase ONGC's total Oil and Gas production by 11 percent and 15 percent respectively," ONGC said in a post on X.