Export opportunity – India oil and gas decommissioning

India – oil and gas decommissioning opportunity summary 

The Indian Government has stepped up its support for two of its largest state-owned energy companies, Oil and Natural Gas Corporation (ONGC) and Oil India Limited (OIL), increasing their capital expenditure to £3 billion and £489 million respectively.

In its annual report, ONGC has set aside an accumulated provision of £3.39 billion and current provision of £79.8 million for decommissioning. Oil India Ltd has kept an accumulated liability of £41.84 million for decommissioning.

Part of this spending will go towards the decommissioning of ageing oil and gas assets (most of which are onshore). As well as this, some private sector operators in India are also looking to decommission assets. 

This will present significant opportunities for Scottish supply chain companies and tier-1 contractors involved in the decommissioning of these types of assets. 

Scale of export opportunity

Well plugging and abandonment costs in India in the near term are likely to be around £100 million. If Scottish companies were to win even 5% of this, it would represent an additional £30 million for the Scottish economy. 

Company suitability

Scottish companies best positioned to win this type of business will fit with some of the following:

• Scottish supply chain companies specialising in late-life asset extension, well plugging and abandonment, environment and waste control.