ONGC Considers Privatisation of 60% Oil Fields to Increase Oil Production

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ONGC Considers Privatisation of 60 Oil Fields to
Increase Oil Production
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• India, which imports about 80 of its oil, is
  looking for ways to increase domestic oil
  production and has reportedly asked the
  state-owned Oil and Natural Gas Company (ONGC) to
  balance a possible sale of a maximum of two
  shares of major oil gas fields.
• Indias Oil Ministry has asked ONGC to consider
  selling 60 of Mumbai High and Bassein oil and
  gas off Indias west coast to private companies,
  as reported by Reuters on Thursday, citing an
  Indian government source communication.
• India is the worlds third-largest importer of
  crude oil, with imports accounting for more than
  80 of petroleum consumption. The country has
  been trying to increase domestic production for
  years, with particular vulnerability to rising
  oil prices and rising import bills, leading to
  rising fuel prices.
• In recent few weeks, India has struggled with
  record oil and diesel prices with global crude
  prices above 80 per barrel amid tight markets
  and the OPEC group being reluctant to release
  more supplies when compared to the determined
  monthly volume increase in July. India has
  criticized OPEC and OPEC for protecting oil
  prices several times this year.
• Now, the competent bodies in the country are
  welcoming private companies by encouraging them
  to increase oil production. The governments
  recent request to ONGC was not an order for the
  state-owned oil company to transfer shares,
  according to a Reuters source.

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Parting thoughts

• If truth be told, promoting domestic production
  will not solve Indias dependence on oil imports,
  but may bring some relief to the country as oil
  prices rise. However, another question worth
  probing is whether India will be able to attract
  private companies to invest in its offshore oil.
• Last month, Indias Oil Minister Tarun Kapoor
  told Reuters news agency that US giant ExxonMobil
  was in talks to invest in some of ONGCs deep-sea
  exploration assets off Indias east coast.
• About UPES CCE
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• Stay tuned for more such insights and industry
  updates about the Indian Oil Gas industry!