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The Pandemic has hastened the pace of transition of ONGC: CMD at CERAWeek

Speaking at CeraWeek Indian Energy Forum 2020, ONGC CMD Mr Shashi Shanker said that the Covid-19 pandemic has fast-tracked the transition of petroleum companies like ONGC. “ONGC coped up with the challenges by adopting new technologies and forging collaborations. We have learnt new ways of operating, both at oil-fields and offices, while ensuring safety for all. ONGCians have worked with full efficiencies while working from home and working on the fields”, asserted Mr Shanker.

CMD Mr Shashi Shanker was speaking at a panel discussion at the Indian Energy Forum organized online by CERAWeek. The topic of the discussion was “Technologies to optimize Cost, Recover & Emissions in Upstream”. The session was anchored by Executive Director in the Upstream Energy Practice at IHS Markit Mr Judson Jacobs, and was also attended by the Group Chief Executive Officer of Vedanta Mr Sunil Duggal and Chairman and CEO of Baker Hughes Mr Lorenzo Simonelli.

CMD Shashi Shanker addressing dignitaries during CERAWeek panel discussion
CMD Shashi Shanker addressing dignitaries during CERAWeek panel discussion

Responding to a query on the cost pressure caused by the pandemic and the impact and application of technologies to recover from it, CMD Mr Shanker said oil exploration and production companies would have to learn to sustain themselves at the current crude oil price points. Mr Shanker noted that due to the pandemic, 2020 has been a stressful year for all segments of the oil industry.

“The year started with a price war, and the prices came to an all-time low.  Going forward, we will have to realize that this is going to be the new normal. We might not see the pre-2014 prices in the coming years and the prices may remain range-bound in low category. We will have to survive and operate in this low-price scenario,” said Mr Shanker.

However, Mr Shanker also noted that even in this low-price scenario, ONGC has been able to deliver positive results by adopting new technologies and collaborating with new business partners. “Business partnership is a key necessity, especially during this time of crisis. There should be more engagement between the operator and service provider.”

CMD during CERAWeek panel discussion with ED Upstream Energy practice IHS Markit, Group Chief Officer Vedanta and Chairman & CEO Baker Hughes
CMD during CERAWeek panel discussion with ED Upstream Energy practice
IHS Markit, Group Chief Officer Vedanta and Chairman & CEO Baker Hughes

Regarding the technologies adopted by ONGC, Mr Shanker stated that ONGC is one of the very few Indian companies to go paperless and operate digitally. He mentioned that data analytics is now in almost every rig of ONGC and real-time monitoring will enable higher recovery. He said that ONGC has adopted 50 automated new generation rigs. He shared how ONGC is encouraging and helping start-ups to come up with project ideas on digitalization – especially in generating new prospects and improving success rate.

Mr Shanker said that ONGC is also working on setting up a Shared Service Center – through which all services will centrally come under one roof. Stating that there is increased opportunity to work in a more collaborative manner, Mr Shanker the Shared Service Center model will facilitate optimal distribution of resources to the operational coordinates.

On measures taken by ONGC to reduce carbon emission and protect the environment, CMD Mr Shanker said that as a responsible corporate, as early as in 2005, ONGC had constituted a dedicated CMSG department to map the oil major’s carbon footprints. “ONGC now earns over 2 million Carbon Emission Reductions.

Speaking during the panel, Group Chief Officer of Vedanta Mr Sunil Duggal reiterated that there is huge opportunity to work with start-ups for adoption of new technologies and growth of digitalization. Mr Duggal noted that proof of concept and accuracy of interpretation are key for operational growth, especially at this time of crisis.

Chairman and CEO of Baker Hughes Mr Lorenzo Simonelli said that the silver linings of the pandemic are that the aspects of technologies have been promising like those related to remote monitoring, diagnostics, remote capabilities and chance for digital collaborations has been enhanced. Stating that climate change is an area of concern, Mr Simonelli said that sustainability and reduction of carbon emission should be done along with cost reduction. He noted that LNG and Gas will be a large growth driver. The Baker Hughes CEO asserted that the Oil & Gas sector along with the new technology frontier will take the industry forward.

CeraWeek India Energy Forum brings global oil experts and industry captains together on a same platform with policy makers.  Indian Prime Minister Mr. Narendra Modi inaugurated this 2020 event on 27 October 2020 through video-conferencing.