Reliance Industries (RIL)
plans to invest $6.5 billion in its KG-D6 gas fields to reattain natural gas production of up to 60 million standard cubic metres per day (mscmd) by 2019-20 and regain the lost glory of the prolific block.
The Bay of Bengal KG-D6 fields had hit a peak of 69.43 mscmd in March 2010 before water and sand ingress led to shutting down of more than one-third of the wells. Current output is
just over 14 mscmd .
"We can attain a production level of 40-60 mscmd by 2019-20 provided we get timely approval and the right natural gas price," RIL president and chief operating officer (E&P) B Ganguly said.
BIG BUCKS FOR MEGA GAS FIELDS
- RIL also plans to invest $3.155 billion in producing 20 mscmd of gas from R-Series discoveries in the block and another $1.529 billion in four satellite fields to produce 10 mscmd
- Another $1.2 billion is planned to be invested in other discoveries in the block
- The company will invest $747 million in augmenting production from D1& D3 and MA fields by putting up booster compressor and repair work at the closed wells
- Besides $6.451 billion, another $6.151 billion is expected to be spent as operating expenses
- These investment are besides the $7.572 billion the company has already sunk in development of D1& D3 and MA fields, $1.261 billion of operating expenses and $1.094 billion in exploring for oil and gas in the block
- RIL is drawing comfort for the future investment from the government approval of the Rangarajan formula for pricing of gas according to which the rate in April 2014 would be $8.2-$8.4
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While the company carries out remedial
measures to augment production from the currently producing Dhirubhai-1 & 3 (D1& D3) and MA fields, it plans to invest $3.15 billion in producing 20 mscmd of gas from R-Series discoveries in the block and another $1.529 billion in four satellite fields to produce 10 mscmd. Another $1.2 billion is planned to be invested in other discoveries in the block, Ganguly further said.
RIL will invest $747 million in augmenting production from D1& D3 and MA fields by putting up booster compressor and repair work at the closed wells. Besides $6.451 billion, another $6.151 billion is expected to be spent as operating expenses, he added.
These investments were besides the $7.572 billion the company has already sunk in development of D1& D3 and MA fields, $1.261 billion of operating expenses and $1.094 billion in exploring for oil and gas in the block.
Ganguly said such large investment is viable at no less than $7.5 per million British thermal unit (mBtu) gas price after considering the cost of capital and royalty paid to the government on production.
First gas from the satellite developments is expected in mid-2017-18, he said, adding the company has not made investment or production projections of the giant MJ1 discovery made two km below D1& D3 field recently.
With inputs from PTI 
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