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Richa Mishra

New Delhi, Aug. 15 The assessment of commerciality and development plan of Gujarat State Petroleum Corporation’s (GSPC) Krishna Godavari Basin gas find is likely to be completed by next month.

A senior Directorate General of Hydrocarbons (DGH) official told Business Line that “the data submitted by the company is being evaluated and the assessment would be completed by September.”

Commercial assessment of a find enables a contractor to know whether the find is commercially viable or not and whether the revenue earned over the life of the field would be more than the capital and operating expenditure. GSPC has drilled 10 exploratory wells in the block KG-OSN-2001/3 till date, of which discoveries have been made in five wells. The assessment of data was being done for KG-8 well in the block, which was submitted by the company in May. GSPC and its consortium have recently struck more gas in the block.

According to company estimates the find of the KG-8 well (Deendayal West) indicated a gas flow of 10 million cubic feet a day. After receipt of the field development plan approval from the DGH, the construction of well-head platform, drilling of developmental wells and onshore gas processing plant will begin, company sources said.

After its recent fresh discovery in the block (KG-22 well), GSPC has asserted that its initial assessment of gas reserves from the block of more than 20 trillion cubic feet (tcf) is valued at over $300 billion at current price levels. GSPC has revised its gas reserves estimates in its Deendayal block to 5.6 tcf (KG-8 well) from the earlier 1.6 tcf, which has already been approved by the DGH. This excludes the KG-22 find.

The recent discovery made in KG-22 well in the block is the fifth find in the same block. According to the company, during the initial testing, gas flowed at the rate of 30 million cubic feet a day in KG-22. GSPC now plans to drill an appraisal well near the discovered area.

Asked whether the assessment of the company was correct, the DGH official said, “It is still too early to put an estimate to reserves.”

GSPC was allotted the block under NELP-III along with Jubilant Enpro Ltd and Geo Global Resources, covering an area of 1,850 sq km. GSPC is the operator, having 80 per cent participating interest.

More Stories on : Outlook | Petroleum

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