ONGC partners with Shell Energy India to jointly explore deepwater oil and gas fields and source LNG for India.

The two companies are looking at jointly bidding for offshore blocks under the government’s OALP Rounds X and XI, along with any future auctions of similar blocks.

No financial details of the partnership have been disclosed yet, and neither company has filed an official regulatory update on the tie up so far.

The logic behind the deal is fairly simple. Drilling for oil and gas kilometres below the ocean floor is neither quick nor cheap.

A single deepwater well can cost anywhere between $125 million and $150 million, and it usually takes five to ten years to go from winning an exploration block to actually producing oil or gas.

Shell brings decades of deepwater experience from projects around the world, while ONGC already holds several offshore blocks in India along with the local operating knowledge needed to run them.

There’s also a bigger push happening behind this. India’s existing oil and gas fields are ageing, with output from them falling by around 6 to 7% every year, according to government data.

Earlier this month, the government cleared Samudra Manthan, its National Offshore Exploration Scheme, setting aside ₹84,084 crore for the programme through FY31.

The goal is to help India find more oil and gas under its own waters instead of depending so heavily on imports. That dependence is significant.

India remains the world’s third largest crude oil consumer, and its annual import bill runs close to $144 billion, or nearly ₹13 lakh crore.

On the financial side, ONGC’s most recent quarterly numbers, released on August 5, showed net profit more than doubling to ₹170.3 billion from ₹66.5 billion in the previous quarter, with the operating margin expanding sharply to 61.03%.

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