The Hindu Business Line : Panel will decide on special status for RIL blocks

New Delhi, Aug. 24 Reliance Industries Ltd (RIL) may have to wait for sometime before special status is granted for its seven blocks in the Kerala-Konkan (KK) Basin.

A final decision on the issue is to be taken by an empowered committee of secretaries (ECoS).

If RIL is granted the special research & development (R&D) status for the blocks it would get additional five years for exploring hydrocarbons in the KK Basin, as it would extend the time period for meeting the work programme. In fact, if a nod is given to RIL, ONGC—which has blocks there—can have something to look forward to.

The special status would also provide a breathing space to RIL, which is facing an acute shortage of deepwater rigs.

Gas Pricing

Indications are that any ECoS meeting is now expected only after the impending issue of gas pricing from the Krishna Godavari Basin is resolved. RIL has been maintaining that the challenge lies in undertaking exploration activities in KK Basin.

It had approached the Petroleum Ministry in December last year seeking special R&D status citing that the region was inter-layered with volcanic margin needing a special exploration paradigm for success.

Since the granting of special status is something outside the production sharing contract, the decision is expected to take time, sources told Business Line.

The exploration activities were tough in the basin as it is dominated by volcanic and igneous intrusions, sources added.

The KK Basin blocks have not seen much bidding in the past as they were not considered very prospective. In fact, two blocks in the basin did not attract any bid at all under the sixth round of bidding. RIL has been awarded one block under the first round of New Exploration Licensing Policy (NELP) and two each in NELP-II, III and V.

While the blocks awarded under the first and second round of NELP are currently in the second phase of exploratory activities, the blocks awarded under the fifth NELP round are in first phase of exploration. The company has tied-up with a Norwegian Institute for undertaking studies in the seven blocks that cover an area of 1.44 lakh sq km.

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