NEW DELHI: After striking rich gas reserves in the Farsi block of Iran, Oil and Natural Gas Corporation (ONGC) has over achieved reserve accretion targets and brought down the insurance spend by 38 per cent for 2007-08 despite a 23 per cent increase in asset valuation.

During the year, ONGC's reserve accretion rose to 65.56 million tonnes of oil plus oil equivalent gas (mtoe) against the MoU target of 52.5 mtoe. Production during the period stood at 48.28 mtoe, resulting in reserve replenishment ratio of 1.36:1.

According to an official spokesman here, the board of directors met on Thursday to take stock of the company performance, including its foreign investment wing ONGC Videsh Limited (OVL). The board noted that work was now on to assess the reserves in the Farsi block. Three are oil wells and one gas well was now operating in the block.

In another milestone, ONGC completed major offshore engineering projects in April on schedule.

The corporation had completed four mega hi-tech engineering projects in the Arabian Sea (Mumbai offshore) recently. The combined expenditure on the projects was estimated at Rs. 2,750 crore.

The spokesman said ONGC had brought down insurance premium for offshore assets by 38 per cent to $29.03 million in 2007-08 from $46.83 million in the previous year. The asset valuation of ONGC's offshore installations — production platforms and complexes, pipelines, rigs, and wells — has gone up by 23 per cent from $13 billion in 2006-07 to $16 billion in 2007-08.

The drop in insurance premium is mainly due to various risk mitigation measures adopted by ONGC. During 2006-07, ONGC made 22 discoveries — nine by new prospects and 13 by establishing new pools.

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