Oil India Discovers Natural Gas in Andaman Shallow Offshore Block

Oil India Ltd has discovered natural gas reserves off the Andaman Islands, the state-owned firm said without putting an estimate of the size of the find.

In a statement, OIL said "occurrence of natural gas" was reported in the second exploratory well Vijayapuram-2 drilled in the Offshore Andaman Block AN-OSHP-2018/1, which the company had won under the Open Acreage Licensing Policy (OALP).

"The preliminary analysis of gas samples, collected during intermittent inflow of gas as part of initial production testing, has confirmed the presence of natural gas. Further gas isotope studies are being undertaken so as to understand the genesis of the gas," the statement said.

Oil India Ltd and Oil and Natural Gas Corporation (ONGC) have been probing for hydrocarbon reserves in the Andaman Sea in the hope of finding a discovery that could help cut India's 88 per cent dependence on imports for its oil needs and 50% reliance on overseas for gas requirements.

ONGC had, in March this year, begun drilling of an ultra-deepwater well ANE-E in the Andaman offshore, but the firm has not indicated the results of the drilling.

"As per preliminary assessment, this could be a leading indicator of the presence of source or migration pathway or accumulation of hydrocarbon, which will help in future exploration and drilling strategy," OIL said.

"OIL is also undertaking additional testing of higher-up prospects to further evaluate the reported occurrence of gas." The company went on to state that this is the first reported occurrence of hydrocarbons during the ongoing exploration campaign in the Andaman Shallow Offshore Block.

While the company did not give further details, Oil Minister Hardeep Singh Puri in a post on X said the discovery was made in the well drilled at a distance of 9.20 nautical miles (17 km) from the shoreline on the east coast of the Andaman Islands at a water depth of 295 metres and target depth of 2,650 metres.

Puri has long touted Andaman as holding a Guyana-scale oil field.

OIL find is the first in the region.

"Initial production testing of the well in the range of 2,212-2,250 metres has established the presence of natural gas with intermittent flaring. The gas samples, brought by ship to Kakinada, were tested and found to be 87 per cent methane," Puri said.

"The size of the gas pool and commercial viability of the discovery will get verified in the coming months, but establishing the presence of hydrocarbons in the Andaman basin is a major step in confirming our long held belief that Andaman basin is rich in natural gas, in line with discoveries in the entire area from Myanmar in North to Indonesia in the south in this belt."