India's Hydrocarbon Outlook – 2022-2023

127 DGH: 3 DECADES OF UNLOCKING INDIA'S HYDROCARBON POTENTIAL For oil and gas production, deepwater and ultra-deepwater fields represent the last bastion of hope. As many onshore and shallow water fields approach exhaustion, deepwater and ultra-deepwater production seem to be the only feasible option available in the foreseeable future. The viability of oil and gas production in these water depths depends critically on the prevailing prices of oil and gas, with the extraction costs typically escalating in tandem with water depth. Advances in drilling and production technology have made it possible to extract oil and gas from ever-deeper depths. High-resolution geophysical exploration technology enables scientists to detect oil and gas deposits in seabed and geological strata, to depths of up to 12 kilometers, leading to the discovery of many major new deposits in recent years. Despite the high cost of drilling in deep water, the high productivity of oil and gas fields can justify the expense, provided oil and gas prices remain high enough to make them profitable. The world's deepest oil and gas project, Stones, operates in around 2,900 meters of water in an ultra-deep area of the US Gulf of Mexico. The project started production in September 2016 from a Floating Production, Storage, and Offloading (FPSO) facility that connects to subsea infrastructure, producing oil and gas from reservoirs situated nearly 30,000 feet below sea level. Exploration and production of oil and gas in offshore areas entail extensive use of seismic imaging and geologic analysis, rigorous engineering design and planning, construction of highly specialized equipment, and compliance with federal or state environmental regulations, all of which necessitate substantial time and financial investment. Offshore drilling operations involve complex, high-risk systems, as the interplay of technological and operational complexities, harsh environmental conditions, geological uncertainties, and high-pressure flammable fluids can potentially trigger catastrophic events, such as the Macondo blowout in the US Gulf of Mexico in 2010 ( Deep Water) and the tragic incident at Mumbai High offshore field in 2005 ( Shallow Water). Offshoreregionsalreadyaccount forasubstantial volume of global oil and gas production, with offshore oil production constituting more than 40% of the world's total oil production and more than 30% of global gas production sourced from offshore fields, with this proportion poised to surge in the foreseeable future. 5.1 Hydrocarbon Resources in EEZ India is home to 26 sedimentary basins, which cover a total area of 3.36 million square kilometers. These basins are distributed over onland, shallow water that extends up to 400 meters of water depth, and deep water that goes beyond the Exclusive Economic Zone (EEZ). Of the total sedimentary area, 49% is located onland, 12% in shallow water, and 39% in deepwater areas. There are 16 onland basins, seven basins that lie in both onland and offshore, and three basins that are completely located offshore. These basins are classified into three groups based on their tectonic origin, which can be traced back to rifting, plate collision, and crustal sag. The hydrocarbon resources in these basins are divided into three categories based on their maturity. Category-I basins already have reserves and are currently producing. Category-II basins have contingent resources that are pending commercial production, while Category-III basins have prospective resources that are awaiting discovery.