Reliance strikes 'gold' in K-G basin

Reliance strikes 'gold' in K-G basin
RIL to supply 40% of India's gas, oil! - another article
40% of India's gas, oil from RIL!

Mukesh Ambani, Chairman and Managing Director of Reliance Industries, does little in half measures.
He had not interacted with the media for at least two years, yet the Chairman of the country’s largest private sector company made up for the hiatus by spending most of Sunday with scores of journalists from across the country.

Ambani was profusely apologetic for spoiling their Sunday. He had thought he would use the interaction to announce to world the first flow of oil from the company’s oil and gas field in the Krishna-Godavari basin, but he was pre-empted by a leak of that news a couple of days ago. So, he was left to explain the significance of the “historic day” for India. He did so with the same passion and commitment that has brought the first commercial quantities of oil flowing from a field just six years after gas was first discovered.

He claimed it was the fastest exploration and production effort in any deep water basin in the world. The global average is about nine years, he said, quoting a Goldman Sachs study.
There is a huge factory set up on the sea bed 7,000-8,000 feet under water, at temperatures close to freezing, run entirely with robots.

It was “world class expertise that Reliance had developed from scratch,” he said.
He said the production of oil and gas from the Krishna basin meant a lot for India’s energy security. He explained that within the next year-and-a-half, his company would be producing the equivalent of 550,000 barrels of oil a day increasing the domestic petroleum output of 1.3 million barrels a day by over 40 per cent, thereby reducing the need to import oil.

The country paid $56 billion last year for imported oil. Ambani said preliminary studies had indicated that the Cauvery and the Mahanadi basins also bore immense potential.
“We are more blessed with gas than oil,” he said. “That is a huge advantage because gas is the fuel of the 21st century, it being environment friendly.”
Alluding to the telecom model that he said had empowered the country, he said that in a matter of months, natural gas can be piped into millions of homes as cooking fuel. It would obviate the need for cylinders to be carried around, and it would be cheaper for consumers, the equivalent of Rs 116 a cylinder. The current price ranges from Rs 304 to 352.

From 5,000 barrels to 5.5 lakh barrels
Commercial production of gas from the D6 block in the KG basin would start from January-March quarter, said Mukesh Ambani.
Ambani said the crude, which started flowing on September 17, is now stabilised at 5,000 barrels a day, and would be scaled up to 5.5 lakh barrels of oil equivalent a day over the next four to six quarters. This would account for 40 per cent of domestic output. Gas would account for 90 per cent of production from the D6 block, and crude the rest.
Gas production would start with 15 mscmd (million standard cubic metres a day) and later be ramped up to 40 mscmd in a few months’ time.
The gas would be sufficient to feed 100-120 million households, power 50 million two-wheelers, 5 million cars and 10 million trucks, as well as supply fuel for 25,000 MW of power.

$20 billion saving per annum
Ambani said production from RIL’s fields will have an enormous impact on “the fortunes of India and Reliance”, contributing to foreign exchange and import bill savings of $20 billion a year.
Reliance owns 90 per cent of the D6 block, and Canada’s Niko Resources owns the rest.
Since RIL faces no scarcity of either capital, technology or talent, a third partner is not under consideration currently, but a good value proposition might change that. If someone were to give RIL a share in an equally productive asset in other parts of the world, the possibility of a partnership cannot be ruled out.

For full details:Reliance strikes 'gold' in K-G basin
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RIL to supply 40% of India's gas, oil!

September 22, 2008
Indian petrochemicals giant Reliance Industries Ltd will account for about 40 per cent of the country's energy production in the next 18 to 24 months, putting the company on track to earn a quarter of its profit from oil and gas production, from 5 per cent now.
The total hydrocarbon output from the Dhirubhai 6 (D6) block in the Krishna-Godavari basin, the field that is expected to more than double India's gas output, will rise to 550,000 barrels of oil equivalent a day (boed) by March 2010, RIL chairman and managing director Mukesh Ambani said in his first media meet in five years.
Text: Business Standard

In monetary terms, it is Rs 86,000 crore (Rs 860 billion) a year, Ambani said, adding the D6 block in the KG basin will transform the country's energy landscape.
Speaking at the sprawling Reliance Corporate Park in Navi Mumbai, Ambani termed the start of oil production at the D6 basin three days ago as a historic occasion not only for the company but for the entire country. The initial production from the block was 5,000 boed.

"From nowhere in 2002 as far as oil production is concerned, we are now set to be among the top 20 integrated energy companies in the world. In fact, RIL will be one of the world's largest deep-water oil well developers," a beaming Ambani said, as his wife Nita Ambani, who was sitting next to him, nodded.
"Around 40 years after Bombay High was discovered, this is India's major victory in the battle for energy security. RIL has managed to produce oil in two years - a time other companies would take just to map out their exploration nitty-gritty," Ambani said, looking appreciatively at his top team led by PMS Prasad, president & CEO (oil & gas).

Ambani is investing $5.2 billion to develop the KG basin. This oil production, Ambani said, will not only benefit customers but also reduce subsidies and thus release huge financial resources that the government can spend on development.
The company will start pumping natural gas from the KG basin in the January-March quarter, which is within the broad target of the company but later than the government's forecast that production would begin by November.

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Source: ET, BS, Rediff, SIfy