Petroleum drilling industry expects increased demand in coming years

India’s demand for petroleum and natural gas is expected to go up, leading to an increased demand for drilling rigs and related services. Despite massive imports, India will continue to look for energy resources within the country. So we expect to see an increased demand,” Jubilant Enpro deputy general manager (business development) Anand Vatsa said

Mumbai: The drilling industry expects a healthy rise in demand for its services based on continuous and strong demand for petroleum and natural gas in the country, reports PTI.

“India’s demand for petroleum and natural gas is expected to go up and correspondingly, there will be an increased demand for drilling rigs and related services. Despite massive imports, India will continue to look for energy resources within the country. So we expect to see an increased demand,” Jubilant Enpro deputy general manager (business development) Anand Vatsa said at a recently concluded petroleum industry summit here.

According to a Jubilant presentation, ONGC is estimated to drill around 150 shallow water wells in the next five years and would have to engage around eight to ten chartered rigs per year in the mid-term.

Besides this, Jubilant expects around 40-50 exploratory wells to be drilled in the east coast in the next three years.

“Exploration activities in the Andaman Islands have been initiated. The entry of British Petroleum, BHP and ENI will increase demand for drilling services. Around 17 to 18 chartered hired jack-up rigs would be required,” he said.

Petroleum industry experts also seem to agree with Jubilant Enpro’s assessment.

“Most of the wells to be drilled on the west coast will be shallow water wells. I would put that figure at around 120 wells. Besides this, wells would also have to be drilled in the east coast. So drilling contractors and rig charter companies seem to have a good opportunity,” ONGC’s former director (exploration), DK Pande, told PTI.

Jubilant also estimates the likely deployment of four to five deepwater floaters in the offshore sector.

“Recent discoveries at RIL’s NEC and Krishna-Godavari blocks may result in long-term intensified drilling activities from 2013 onward, with expected drilling requirements of around 80 wells.

“Also, after ongoing appraisals, ONGC’s forward development plan for Krishna-Godavari and Mahanadi are expected to result in an incremental drilling programme of around 50 wells from 2014-2015. Besides, deep water blocks awarded under New Exploration Licensing Policy (NELP) VIII and IX are expected to further maintain the drilling momentum from 2014 onward,” Mr Vatsa said.

An industry expert from a leading private petroleum company also concurred with these figures.

“Exploration of these blocks is already on. So I would say that these figures are not unrealistic at all, technically speaking. But this would depend on how fast ONGC will take decisions and act on them. If it does so, then Jubilant’s assessment seems to make sense,” the expert said on condition of anonymity.

As per Jubilant’s estimates, India now has a strong offshore drilling industry and has one of the three largest jack-up deployments in the world, with 27 rigs, including those owned by the ONGC.

“Operators including ONGC and British Gas are keen to increase the number of high specification rigs to drill extended reach wells from existing as well as newer platforms.

There would be incremental demand for deepwater and ultra deepwater rigs from 2013-2014 onward. However, the lower-end of deep water drilling below 6,000 feet would continue to be a major chunk of the market,” Mr Vatsa said.

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RBI directs private, foreign banks to set up vigilance systems

The RBI, which mapped existing vigilance functions of a few private sector and foreign banks with the existing guidelines, found that the practices varied widely among the banks. The directive aims at bringing in such banks in line with the practices followed by state-owned banks to check frauds and other malpractices

Mumbai: The Reserve Bank of India (RBI) on Thursday asked private and foreign lenders to put in place a system of internal vigilance machinery and appoint a chief of internal vigilance (CIV) by August to check frauds and malpractices. The directive aims at bringing in such banks in line with the practices followed by state-owned banks to check frauds, reports PTI.

“In an endeavour to align the vigilance function in private sector and foreign banks to that of the public sector banks the existing vigilance functions of a few private sector and foreign banks were mapped with the existing guidelines in the matter and it was observed that the practices vary widely among the banks,” RBI said in a notification.

“It has therefore been decided to lay down detailed guidelines for private sector and foreign banks on similar lines so that all issues arising out of lapses in the functioning of the private sector and foreign banks especially relating to corruption, malpractices, frauds, etc can be addressed uniformly by the banks for timely and appropriate action,” it said.

A compliance report to this effect may be submitted to RBI on or before 31 August 2011, it said.

In a separate notification, RBI asked all the banks and financial institutions to streamline procedure for detection of fraud and recovery of misappropriated funds.

The matter assumes significance in the light of Rs460 crore fraud in Citibank’s Gurgaon branch discovered last year.

The Central Vigilance Commission (CVC) has issued guidelines to public sector banks on the appointment of Chief Vigilance Officer (CVO).

The purpose of having such system in place is to ensure that all the internal vigilance functions in the public sector banks are addressed through a set of pre-determined and structured procedures to ensure comprehensive treatment and transparency.

As per the guideline, the designated officer similar to CVO in case of public sector banks acts as a special assistant or advisor to the CEO of the concerned bank in the discharge of these functions.

An officer of suitable seniority is required to be designated as a CIV who will head the internal vigilance division of the bank, it said.

The normal tenure of a CIV would be three years extendable up to a further period of two years, it said, adding, but if the officer has to shift from one bank to another without completing the approved tenure in the previous bank, the principle of overall tenure of six years will apply.

Besides, the CIV would also acts as a liaison officer between the bank and the police or Serious Fraud Investigation Office or other law enforcement authorities, RBI said.

The guideline also said banks should identify sensitive positions and frame specific board approved internal policy on staff matters such as rotation of staff in general and in respect of sensitive desks in particular.

RBI, in another notification, said that the banks need to introduce closer monitoring and tighter controls in the above areas, as also in other such areas where there is typically certain degree of concentration of occurrence.

Further, care may be exercised while dealing with instances of wilful default, it said.

An important corrective step in a fraud is recovery of the amount siphoned off through the fraud, it said.

The central bank has also said that for key and sensitive posts such as those in dealing rooms, treasury, relationship managers for high value customers and heads of specialised branches, the banks should select only such officers who satisfy the fit and proper criteria.

The banks should immediately put in place staff rotation policy and policy for mandatory leave for staff, it said.

The banks should build up a database of officers or staff identified as those having aptitude for investigation, data analysis, forensic analysis, etc. and expose them to appropriate training in investigations and forensic audit, it said.

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Groupon is now testing the waters—it wants to mop up $750 million.

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