July 28, 2005

Twelve die, hundreds rescued in Indian oil rig fire

By Himangshu Watts and Hiral Vora

NEW DELHI/BOMBAY (Reuters) - Twelve people died and 367
were rescued after fire destroyed an oil platform off India's
west coast, and officials said on Thursday it may take a year
to rebuild a platform that produced a sixth of the country's

Oil Minister Mani Shankar Aiyar said ONGC would be able to
restore 70 percent of the platform's output of 110,000 barrels
per day within a month.

An official at platform owner Oil and Natural Gas Corp.
(ONGC) said the platform would be replaced with a new structure
by the end of next year.

ONGC's Bombay High North (BHN) platform was destroyed on
Wednesday when a support vessel lost control in rough seas and
collided with the structure.

Coast Guard officials said several helicopters, six navy
and two coast guard ships, and many civilian vessels were
scouring very rough seas in bad weather for any survivors of
the fire.

"We have picked up people from the sea and there were
people who were in the water for more than 12 hours," Madanjit
Singh, vice-admiral of the Western Naval Command, told a news

The navy said six divers remain trapped in the support
vessel, and one or two people were missing, while 367 people
had been rescued.

The sunken platform is about 160 km (100 miles) southwest
of India's financial hub, Bombay, where heavy rains and severe
flooding have already stretched emergency services.

ONGC officials said the platform was insured for $195
million but the new structure may cost about $300 million.

State-run refiners would also lose money buying additional
crude from the spot market instead of ONGC's oil, which was
sold to domestic oil companies at a discount.

The government had asked ONGC to give discounts to refiners
to partly make up for selling fuels at low administered prices.


About 225 people were working on the platform when fire
broke out at about 0700 EDT on Wednesday and many others were
in the support vessel and a nearby rig.

Some people jumped into lifeboats to escape the flames and
get to platforms nearby.

Rescue operations were hampered as ONGC's helicopters in
Bombay were grounded because of floods.

Bombay High, India's largest offshore field, produces 14
percent of the oil India consumes and accounts for 38 percent
of all domestic production.

The platform's production of 110,000 barrels per day is out
of a total Bombay High production of 260,000 barrels per day.

ONGC engineers live on the BHN platform, which is connected
to 15 oil wells and pumps oil to the coast. It is fixed to the
seabed 80 meters (265 feet) below the surface of the Arabian

Aiyar said other platforms in the field continued to
function normally. Platforms tend to be 2-3 kilometers apart.

An ONGC official said on Thursday there was unlikely to
have been an oil spill as a result of the fire because the
systems would have automatically shut down, and any oil or gas
that did leak would have probably been consumed by the flames.

The field was discovered by a Russian and Indian oil
exploration team during the mapping of the Gulf of Cambay in
1964-1967. The first well was sunk in 1974.

The field, where workers tend to do shifts of about two
weeks at a time, attained a peak production of 400,000 barrels
of oil per day from 1985 to 1989.

To arrest the decline from its most prolific field, ONGC
invested 85 billion rupees ($2 billion) to redevelop the field
from 2001.

ONGC is India's largest company by value, with a market
capitalization of about $32 billion.

($1 = 43.5 Indian rupees)

(Additional reporting by Suresh Seshadri in BOMBAY)