Fresh after getting approval for
investing $7.2 billion in Reliance Industries' oil and gas properties, BP Plc on Wednesday pressed for an early government nod to develop satellite fields in the KG-D6 block and reverse
sagging natural gas output from the prolific acreage.
Bob Dudley, the Chief Executive of Europe's second biggest oil company, arrived in the national capital on Tuesday evening on a two-day visit, during which he will meet the virtual who's-who of the government - from Prime Minister Manmohan Singh to Finance Minister Pranab Mukherjee and Oil Minister S Jaipal Reddy.
MUST SEE: The RIL-BP marriage Before his Thursday visit to the KG-D6 fields, which has been at the centre of BP's $7.2 billion investment to buy a 30 per cent stake in 23 oil and gas properties held by the Mukesh Ambani-run firm, Dudley said the block holds the resources to get back to the planned 80 million standard cubic metres per day of gas output.
"I think yes," he told NDTV in an interview when asked if there was enough gas in the block.
Referring to D6 as the "Golden Block", he said: "D6 is a world class resource", but also a "complex reservoir" that needs high technology and risk taking.
"BP's great sub-surface exploration skill" can help Reliance get back the sagging output, he said.
There are more fields around the currently producing Dhirubhai-1 and 3 (D1 and D3) fields in block KG-DWN-98/3, or KG-D6, which need to be quickly brought to production.
"What we need to do now is develop those satellite fields... We are hopeful that the government will approve development of satellites and that is how you can bring gas production back up," he said.
Reliance has submitted a plan to invest over $1.5 billion in developing four satellite fields around D1 and D3 to produce up to 10 mscmd of gas by 2016.
D1 and D3 have seen output drop to 36.5 mscmd from 54 mscmd in March last year instead of rising to 61.88 mscmd as planned for the current year. Together with 7.4 mscmd from the MA oilfield in the same block, the total gas production from KG-D6 currently is 43.9 mscmd.
Reliance has attributed the fall in output to a drop in reservoir pressure and water ingress, but upstream oil regulator DGH said the company has not drilled an adequate number of wells.
Dudley stressed that approval for the satellite field development should come so that the winter - when weather does not permit drilling in Bay of Bengal - can be used for engineering and actual site work can begin when the weather window opens up early next year.
"I believe it will take to 2014 to get these kind of structures developed and tied back into infrastructure. We can see the resources out there and and I believe by 2014, we will be back up," he said.
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