In collaboration with erstwhile USSR and Romania, the Oil and Natural Gas Commission started country-wide search for oil. Their labour bore fruit and fresh wells, at Naharkatiya, Sibsagar in Assam and Ankleswar and Lunej in Gujarat were discovered.
The crude oil from Assam feeds the oil refineries of Barauni (Bihar), Noonmati (Assam) and Bongaingaon (Assam) and crude oil from Gujarat feeds the Koyali (Gujarat) refinery. Oil India Ltd. has been successful in striking oil at Duliajan in the Dum Duma area of Upper Assam.
The search for oil could not have assumed more importance as it has now but for the steep rise in oil prices announced by OPEC in 1973. The prices were increased fourfold. The worst hit were the developing countries like India, Bangladesh, Sri Lanka, Nepal etc.
Prices of crude oil reached a new peak in 1981 on account of political instability in Iran, the Russian aggression in Afghanistan and world-wide oil shortage. If the rising oil prices earlier raised eyebrows and caused concern, the falling oil prices in 1998 brought relief and much needed saving of foreign exchange.
The oil scenario continues to be complicated. After reaching a peak of $33 a barrel in mid-2000 the oil prices declined to $25 a barrel in 2001. In anticipation of the West Asian crisis, oil prices peaked once again in 2002, and hit a new high in early 2003.
The OPEC holds the key to the oil prices pursuing its contention that the quantum of oil production and the market-prices prevailing the world over, are in inverse proportion higher the production lower the prices and vice versa. In mid- 2001, the OPEC decided to lower production by a million barrels per day the prices in the international markets rose sharply.
OPEC did not concede to India’s request for lowering the oil price for developing countries. In early 2005, oil prices over averaged $ 50 per barrel. The spiralling oil prices touched a new high in late 2007, when they hovered around $100 per barrel, the economies of the developing and non-oil producing countries felt the shock and the fears of a recession and depression gripped the market.
India was saved from the severe shock by two factors; the rupee has revalued by almost 15 to 20 per cent and the IT exports have topped over $35 billion, the inward remittances hover around $24 billion annually. Oil prices have been on a roller coaster, they peaked to over $147 a barrel in early 2008; & then recession hit the world a fell to a low of $37 by late 2008.
By early 2010, they have hovered around $70 a barrel, a comfortable benchmark for the OPEC, Domestic prices are adjusted whenever The international price fluctuate India’s domestic oil production received a boost when Barmer fields added about 1/6th more oil to the existing production of 6 million (six lakh barrels) per day.
Drilling for oil in India was taken up almost simultaneously with similar efforts in other parts of the world. The first oil well in India was discovered in 1867 in Assam by the movement of elephants through the oil fields accidentally. There are many areas in India known to have hydrocarbons.
The possibility of locating petroleum in the Himalayan foothills of U.P., Punjab, Himachal Pradesh, Jammu and Kashmir has always attracted the attention of petroleum geologists. Potential sources of petroleum and gas in India inter alia are: Kerala, Lakshadweep, Bengal, Punjab, Krishna, Godavari and Ganga basins, Andaman and Bombay High. The real bonanza occurred in February 1974, when oil was struck in the Bombay High region by Sagar Samrat.
Some oil wells were discovered in Ratnagiri region of Maharashtra in November 1979, but they were of no great significance. There are hopes that oil will be discovered in the East Coast of India. In the Godavari Basin in Andhra Pradesh some oil has been struck. Natural gas has been found in commercial quantities.
Industries based on natural gas including fertilisers and petrochemicals have already been set up. A structure close to the Bombay High is likely to account for a production of about a few million tonnes annually. Oil and natural gas is also likely to be discovered in commercially viable quantities in Tripura.
There is a possibility of some oil being found in Arunachal Pradesh region. Tripura has already emerged as a major producer of natural gas which is currently being supplied to power projects. In 1989, the ONGC discovered major oil fields in the Krishna-Godavari region of Andhra Pradesh and the Cauvery basin in Tamil Nadu.
A few prolific oil bearing regions have been offered to the foreign companies (including now defunet ENRON) for undertaking exploratory oil drilling work.
During the last few years ONGC and OIL have carried out exploration works in the offshore and onland basins of Bombay, Kerala-Konkan, Krishna-Godavari, Cambay, Saurashtra and Cauvery, Assam Arakan fold belt, Himalayan foothills, Ganga Valley and in the states of Arunachal Pradesh, Rajasthan, Gujarat, West Bengal and Madhya Pradesh.
Premier Oil, a British exploratory company, has been drilling in Tripura and Cachar areas. The Press had excitedly announced in Oct. 2007 that Premier Oil had discovered huge deposits of oil and natural gas in Assam; but it is yet too early to be euphoric.
Oil has started flowing of The Barmer wells in July 09, it was located by CAIRN. Ltd, a British exploratory company. The Barmer fields will add about 16% of the existing oil production of India. It was reported that OIL INDIA LTD has also discovered oil in Rajasthan in Sep 2009 at Bajhawala in Barmer. It is likely that experts from Venezuela will also join the exploration work.
Crude output to rise 25% as Cairn set to pump oil: India’s crude production rose by a quarter in phases starting in August when Scottish explorer Cairn Pic’s Indian arm, began pumping from the Mangla field of its Rajasthan acreage. At an optimum production level, the acreage is estimated to reduce India’s oil import bill by $6.8 billion, or 7%.
These exploration efforts have resulted in oil and gas discoveries at 32 places notably in Rajasthan (Barmer region by Cairn Energy) and Krishna-Godavari region in 2002-2003.
Oil finds. The first find came from Gujarat State Petroleum Corporation (GSPC). It found 50 million barrels of oil near Dholka town, 50 km from Ahmedabad. The second discovery was reported by Cairn Energy of UK. It made a fourth significant oil discovery at Fatehgarh in Barmer district of Rajasthan. It is estimated to have 300 million barrels of oil.