BP, RIL to invest $5 b over 3-5 years
This is not for the first time that BP and Reliance Industries Ltd (RIL) have spoken about their plans to increase output from the KG-D6 block. The plan, when implemented, would entail a total investment in excess of $5 billion over the next three to five years.
So, what was different on Tuesday?
On Tuesday, Bob Dudley, BP Group Chief Executive, who is part of the entourage of the British Prime Minister, David Cameron, along with Mukesh Ambani, Chairman and Managing Director, Reliance Industries Ltd (RIL), met the Petroleum and Natural Gas Minister, Veerappa Moily.
The two chiefs updated the Minister on the KG-D6 block enhancement plan in the meeting that lasted over an hour and came out feeling more optimistic than before, sources said.
The sense of optimism comes from the fact that the Petroleum Minister is committed to providing the necessary support to promote investment in the domestic oil and gas sector. While Ambani was accompanied by P.M.S. Prasad, Executive Director, RIL, Dudley was with Sashi Mukundan, Country Head, BP India. Both of them also updated the Minister on their joint future plans in India, a joint statement by the two companies said.
Under the KG D6 block enhancement plan, BP and RIL plan to invest in a series of projects to develop around 4 trillion cubic feet (tcf) of discovered natural gas resources from the block. At the current international liquefied natural gas prices, it would cost more than $50 billion to import this volume of gas into India.
Both Ambani and Dudley agreed to accelerate the pace of exploration and development activities as soon as the necessary approvals are received.
“The BP- RIL partnership is focused on finding more hydrocarbons and addressing the complexities of the geology along the east coast of India,” Ambani said.
“We will bring all our expertise in deep water to explore the prolific gas basins in India and BP looks forward to a rewarding and successful exploration programme in the coming years,” said Dudley.
The implementation of the plan will require deployment of advanced skills, processes and technologies through the combined partnership of RIL and BP to produce gas from water depths of more than 1,500 metres.
Both RIL and BP are confident that the development of existing discoveries, together with exploration prospects in KG D6, had the potential to enhance domestic production significantly.
Leading the largest-ever trade delegation from the UK to any country, David Cameron said, “BP is already the largest single British investor in India and the decision to join forces with Reliance Industries to invest $5 billion in the next few years into India’s gas markets, reinforces how two of Britain and India’s leading companies can work together to invest in and supply the energy needs of the future, creating jobs and boosting prosperity.”