The Hindu Business Line : Consultant confirms oil, gas in Reliance K-G blocks

Chennai, May 28 Petroleum consultant Gaffney, Cline & Associates Ltd has confirmed the presence of oil and gas in two offshore blocks in the Krishna-Godavari basin — D3 and D9.

These two blocks lie on either side of the D6 block, from where Reliance has just begun producing gas. Reliance has a 90 per cent interest in D3 and D9, the other 10 per cent is with Hardy Oil and Gas Plc of the UK, a company majority-owned by NRIs.

GCA was hired by Hardy Oil to assess D3 and D9, and the report of the consultants was issued on Wednesday.

Calling Krishna-Godavari basin “an emerging world class petroleum province,” the report has come up with a matrix of resources in best, worst and most probable scenarios.

Two wells drilled earlier in the D3 block had shown presence of gas there. The GCA report confirms this and the presence of gas and oil in D9. But the commercial viability of the gas at these two discoveries (christened Dhirubhai 39 and Dhirubhai 41) are yet to be determined.

With expert-vindication of their findings, Reliance and Hardy Oil should feel encouraged to take further steps.

“The report confirms the significant hydrocarbon potential of our exploration assets in the K-G basin. The two discoveries on D3 in conjunction with the acquisition of risk mitigating technologies and geotechnical studies have resulted in the upward revision of the perceived Geological Chance of Success on both of our K-G blocks,” says Mr Sastry Karra, Chief Executive, Hardy Oil.

GCA considers the methods of Hardy and Reliance for prospect generation and resource assessment to be "sub optimal" and "does not reflect the industry Best Practice". (Reliance is the operator of the blocks.)

Noting that "multiple play (oil or gas bearing sand layers) opportunities exist", GCA says that Hardy/Reliance assessment does not reveal the full resource potential of the assets "in particular, in Block D3".

Recommending a "strategic exploration programme", GCA advises a "new, updated technical evaluation."

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After D6, all eyes on adjacent blocks
Panel confirms allocation of RIL’s D6 gas to power cos
‘Reliance’s D6 gas output to reduce oil import bill by 10%’

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