ONGC Unveils $10.5 Billion Strategy to Boost India’s Deepwater Energy Production
India’s state-owned energy giant, the Oil and Natural Gas Corporation (ONGC), has announced an ambitious capital expenditure plan aimed at reversing over a decade of declining domestic output. The company plans to invest approximately $10.51 billion (Rs1tn) over the next five years to aggressively explore the country’s deepwater and ultra-deepwater oil and gas frontiers.
The announcement was made by ONGC Chairman and CEO A.K. Singh, who confirmed that the strategic funding will facilitate the drilling of 87 wells by March 2031.
Addressing a Prolonged Production Slide
The move comes as India faces a challenging energy landscape; fiscal year 2026 (FY26) marked the 11th consecutive year of falling crude oil production in the country. By pivoting toward previously inaccessible offshore resources, ONGC hopes to leverage recent technological advancements to tap into significant, untapped hydrocarbon reserves.
“Recent technological advancements are now making it possible to tap into India’s substantial deepwater oil and gas resources, which were previously considered inaccessible,” Singh noted during a news conference. This deepwater exploration initiative is viewed as a critical component of India’s long-term strategy to ensure national energy security and reduce dependence on expensive imports.
To support these operational goals, ONGC recently secured a two-year binding letter of award with offshore drilling specialist Transocean. The agreement will see the deployment of the Dhirubhai Deepwater KG2 drillship to bolster India’s offshore drilling capacity.
Strengthening Energy Security and Trading Infrastructure
Beyond exploration, ONGC is diversifying its strategic assets to better navigate volatile global energy markets. The company has been mandated by the Indian government to construct a 1.75 million-tonne (mt) Strategic Petroleum Reserve (SPR) in Mangalore. With land acquisition already completed, this facility will serve as a vital buffer against supply chain disruptions and global price fluctuations.
In a push to expand its international footprint, ONGC also intends to launch a dedicated trading unit by March 2027, with potential headquarters in either Dubai or Singapore. The proposed joint venture is designed to handle up to 50mt of crude oil, refined fuels, and gas annually. This venture will not only manage ONGC’s internal product volumes but will also facilitate the trading of third-party assets, marking a significant evolution in the company’s business model.
As ONGC shifts its focus toward these high-tech offshore projects and global trading capabilities, the sector is watching closely to see if these investments can effectively turn the tide on the nation’s long-standing production decline.
