Reliance Industries Ltd’s (RIL) D6 discovery in the Krishna Godvari basin is likely to produce 2.8 billion cubic feet (bcf) a day of natural gas from August.
Likely to pump 2.8 billion cubic feet
NEW DELHI: Reliance Industries Ltd’s (RIL) D6 discovery in the Krishna Godvari basin is likely to produce 2.8 billion cubic feet (bcf) a day of natural gas from August 2008 with 70% of the onshore and 65% of the offshore work completed.
RIL, the operator with 90% holding, with its partner Niko Resources that has 10% participating interest in D6, is currently in the process of starting production which has already been slightly delayed. Company sources said eight other natural gas discoveries in D6 were under review by a managing committee for development.
Oil and natural gas recovery from the ground is broadly divided into exploration phase, when companies establish presence of the resources, followed by development that involves further drilling for preparing the finds for the next stage of production.
Analyst sources said cash flow for the two companies was about six months away. “There has also been an increase in capital expenditure at D6 by $10 million,” said an analyst.
Production from the D6 block would go a long way in defining the course of energy market in the country over the next few years. The company had earlier announced that it would in a position to produce both natural gas and crude oil from the block though sources said they were more “concerned of ramp up” in oil production and so much about gas production.
Two rigs, Deepwater Frontier and Discovery 534, have currently been deployed in deepwater on the D6 block despite the tight situation globally on the rig front.
RIL had last week also announced its first gas discovery in exploratory block KG-DWN-2003/1 (KG-V-D3) which it had bagged in the fifth round of New Exploration and Licensing Policy (NELP).
The block, located about 50 kilometres from Machalipatnam, Andhra Pradesh, in the Bay of Bengal, covers an area of 3,288 square kilometres. RIL holds 90% participating interest (PI) and Hardy Exploration and Production India Inc holds balance 10% in the block.
jyoti_m@dnaindia.net
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