News Detail

• Private explorer Reliance Industries (RIL) has sought government’s ‘conditional approval’ to go ahead with exploration in four satellite gas fields on the fringes of the KG-D6 block. The company has targeted these satellite fields in KG-DWN-98/3 to shore up its hydrocarbon output.Management committee for the block that met earlier this month had advised RIL to submit a revised capital expenditure plan for the satellite fields. The management committee, headed by upstream regulator director general of hydrocarbons, has not given its go-ahead for carrying out exploration in these fields.Mukesh Ambani-promoted Reliance Industries wants oil ministry to allow it to carry out activities such as geo-technical investigation, geo-hazard study, geo-mechanical study, concept study and front-end engineering and design, till it submits the revised capital expenditure plan.
• “We request you to please give conditional approval of the OFDP allowing the contractor (RIL) to undertake the activities,” RIL said in a letter to the oil ministry on December 8.“The approval can be contingent on submission of revised cost estimate and the contractor returning to the management committee for authority to proceed further. This will greatly help in expediting the development activities in order to increase the level of gas production sooner rather than later,” the letter added. RIL has explained to the oil ministry that current weather conditions in KG basin are favourable for carrying out these technical studies. If these studies are not conducted in the next couple of months, the project would be delayed by another year.
• The optimum field development plan (OFDP) for these fields have been pending since December 2009. Now, RIL has targeted these fields that would help preventing dip in natural gas output from the block after output from D1, D3 and MA fields have gone below 40 million metric standard cubic metres of gas per day (mmscmd).According to reports, RIL has submitted capital expenditure plans for $1.52 billion to develop satellite fields in KG-D6 block. The explorer expects to drill nearly 10 mmscmd in five years. Financial Chronicle couldn’t verify these figures independently.
• On December 2, the management committee questioned the ‘validity’ of capital expenses for these four satellite fields in KG-D6. RIL did not respond to an email sent by this newspaper seeking comments on this issue.RIL scrip has hit one-year low of Rs 709.15 on Tuesday on the Bombay Stock Exchange (BSE). The stock closed at Rs 713.55, down Rs 22.30, or 3.03 per cent at the end of trading session on BSE. The private explorer’s scrip has seen 32.57 per cent decline compared with 26 per cent fall in the BSE benchmark Sensex. Since April 2011, the scrip has remained in sub-Rs 1,000 levels.
• RIL and its new foreign partner BP targets to monetise satellite fields in KG basin. “RIL and BP are planning to develop discoveries known as the R-Series and other satellite fields in the KG-D6 block,” BP was quoting saying by Bloomberg News.According to Bloomberg News article, RIL has spent about $ 5.6 billion on developing the KG-D6 block, or 64 percent of the expenditure approved by the government. The explorer has told DGH that it wants to spend the remaining $3.2 billion to develop the R-Series and other satellite fields in the KG-D6 block.Natural gas output from KG D6 block has touched lowest figure since it started commercial production in 2009. The fields in the block produced just 39.80 mmscmd in the first week of December.

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