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Texas-based DeGolyer and MacNaughton (D&M), an international petroleum consultant, is set to assess ONGC’s claims that gas from its East Coast fields was being drawn by Reliance Industries Ltd (RIL), which operates a neighbouring block.
The Directorate General of Hydrocarbons has conveyed this to ONGC, which, will appoint the firm along with RIL.
Ideally, the two sides should have resolved the issue across the table, as these are natural geological concurrences and not man-made boundaries. But they were unable to do so.
After a series of meetings, ONGC and RIL finally decided to appoint an independent consultant to resolve the dispute.
Two consultants, D&M and Gaffney, Cline & Associates (GCA), were shortlisted from the four global experts identified, another source said.
Both the consultants have worked with Indian oil and gas companies on exploration activities and reserve assessments in the past.
Legal case to continue ONGC, which had moved the Delhi High Court in May alleging that RIL was drawing natural gas from its fields in the KG-DWN-98/2, which are adjacent to the latter’s gas-producing D6 block in the Krishna Godavari basin, will continue to pursue the case.
RIL may end up sharing the benefits from its block with ONGC if the consultant finds ‘connectivity’ in the reservoir. Once continuity is established, a pro-rata allocation of volumes will take place.
After ONGC requested the Government for data on the RIL-operated KG-D6 block, to study the continuity of the reservoir, the technical teams of the two companies started examining the data. But, they could not reach any consensus, and the need for an international consultant arose.
Continuity issue While Reliance Industries has been stating that no wells have been drilled in the area, as claimed by ONGC, the public sector company says that after reviewing the data of its block, it suspected there was a continuity of reservoirs across the block.
Sharing of data will not only help in deciding the reservoirs’ continuity, but also in assessing the amount of gas in the two areas.
Common practice
Seeking information about adjacent blocks for geo-scientific purposes is a common global practice (at times even between countries) as it helps in better understanding of the area.
Domestic operators such as Reliance Industries have also done this in the past.
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