The contract involved collection of 3D seismic data in the Krishna Godavri (KG) basin but the termination came before the actual collection was to begin.
NEW DELHI: Liaohe Petroleum Exploration Bureau (LPEB), a subsidiary of China National Petroleum Company, has been thrown out of a project that the company started working on about a year back for Oil & Natural Gas Corporation (ONGC).
The contract involved collection of 3D seismic data in the Krishna Godavri (KG) basin but the termination came before the actual collection was to begin.
This may have to do with the red flag attached to Chinese operations in the country, especially in sensitive operations. It was for the first time that such a work for data collection was given to a Chinese company in the country.
An official spokesperson did not confirm or deny the development, but sources said it might have to do with the threat perception from the Chinese. A senior ONGC executive, however, said: “There were delays in the execution of the project” and “the company decided to do it departmentally”.
Sources said the company was in the process of seeking clearances from various ministries, including those from home affairs and external affairs, for starting the work but the company was informed of the termination of contract last week.
The Chinese company was to conduct data acquisition, crucial for assessing the hydrocarbon (crude oil and natural gas) potential in a sedimentary basin, in different sectors of the KG basin in Andhra.
India has been seeking Chinese partnership for securing energy needs of the two Asian giants over the past few years, but the sensitive nature of the work that involved using sophisticated equipment in coastal border is suspected to be the reason behind cancellation of the contract.
Sources said LPEB was upset with the Indian authorities since it had already imported equipment into India and was even planning to open a branch office.
“The Chinese threat perception is so high that even the company’s top management has been awaiting visa from the Indian embassy at Beijing,” claimed a source.
This is not the first time that the Chinese have been viewed with suspicion in the oil sector.
About a year back, staff of a Chinese company had to face hardships for getting an Indian visa to lay pipelines for Gas Authority of India Ltd and Reliance Industries Ltd, though the clearance came eventually.
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