Announcement of World Bank Lends Four Hundred Million Dollars for Petroleum Production in India on December 11, 1980

FOR IMMEDIATE RELEASE World Bank '1818 H Street, N.W., Washington, D.C. 20433, U.S.A. • Telephone: (202) 393-6360 BANK NEWS RELEASE NO. 81/32 December 11, 1980 WORLD BANK LENDS $400 MILLION FOR PETROLEUM PRODUCTION IN INDIA India's efforts to increase petroleum production will be assisted by a loan of $400 million from the \.Jorld Bank. The loan, the largest single opera- tion for the Bank, will help finance the foreign exchange cost of the develop- ment of the Bombay High oil and gas field, located about 160 kilometers from Bombay. The $823.2 million project will help complete the development of the southern and central areas of the Bombay High field, and thus help it achieve a production potential of 240,000 barrels a day by mid-1982. The principal components of the project are: drilling of 64 development wells, construction and installation of 15 production platforms, construction qnd installation of a three-deck processing platform--Bombay High South--and a separate 1 iving quarters platform. The project also includes about 133 kilometers of subsea flow 1 ines, expansion of shore facilities, extension of telemetry and telecon- • trol installations, and engineering, technical services and reservoir consul- tancies . The Bank and IDA have been associated with the development of India's energy sector since 1950. The two institutions have made 20 loans and credits totaling $1,504 mill ion for power generation and transmission and two loans totaling $47.4 mill ion for coal production. The new loan of $400 mill ion is the second from the Bank in support of development of India's petroleum sector. The Bank made a loan of $150 mill ion in 1977 for Bombay High Phase I I I. The project included production wells, production and production-processing plat- forms with a combined capacity of 180,000 barrels per day and ancill iary facilities. The project is expected to be completed later this month. The World Bank loan to India is for 20 years, including five years of grace. It will carry interest at the rate of 9.25% per annum. it will be passed on to the Oil and Natural Gas Commission (ONGC) with the same maturity and grace period but at 10. 75% annual interest. NOTE: Money figures are expressed in U.S. dollar equivalents . • FORM NO. 1121 (5-76) T E C HN I CA L D A T A PROJECT: COUNTRY: TOTAL COST: Second Bombay High Offshore Development India $823.3 mill ion • BANK FINANCING: $400 mill ion for a term of 20 years, including 5 years of grace, with interest at 9.25% per annum OTHER FINANCING: Government of India and the Oil and Natural Gas Commission IMPLEMENTING ORGANIZATION: Oil and Natural Gas Commission Dehra Dun, UP, India PROJECT DESCRIPTION: The project comprises Phase IV and advance action items of Phase V of Bombay High Development. The principal components are: drilling of 64 wells, construction and installation of 15 production platforms, construction and installation of a three-deck processing platform (Bombay High South) and a separate living quarters platform. It also includes about 133 kilometers of subsea flow 1 ines, expansion of shore facilities, extension of telemetry and telecontrol ins~ lations, and engineering, technical services and reservoir consultancies. PROCUREMENT: Contracts for items to be financed from the Bank loan will be awarded on the basis of international competitive bidding, except that, subject to prior approval of the Bank, items with limited sources of avail- ability, whose timely supply is critical to efficient project execution and which are estimated to cost $2 mill ion or less, may be procured on the basis of quotations from short list of suppliers, provided that the aggregate value of such contracts does not exceed $7.5 million. A preference of 15% or the customs duty, whichever is less, will be applied to any local bid for the purpose of bid evaluation. ECONOMIC RATE OF RETURN: ESTIMATED COMPLETION DATE: Over 100% 1983 - 0 - •