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BP and its Indian partner Reliance Industries Ltd (RIL) will quadruple output in the country by 2020. BP said it hopes to achieve this increase in output from its entire portfolio, including KG and Cauvery.
"With the two recent significant deep-water discoveries, our exploration effort is well on its way to unlocking the next major hub for development on the east coast of India. An opportunity awaits the BP-RIL joint venture to quadruple production by 2020 as we rework the fields and get into the next phase of development of already discovered resources,” Sashi Mukundan, Regional President & Head of Country, said while addressing the 12th Petro India Summit organised by the India Energy Forum.
"Our joint venture alone could reveal a prize of over $100-150 billion for India by avoiding costly imports," he added.
Later, talking to mediapersons on the sidelines of the event, Mukundan said he did not want to give a precise number for output and 'quadrupled production' would come from all the blocks it has in India and not just KG D6.
"We had two discoveries in the Cauvery. We are preparing to drill wells next year (2014). All these together give us the feel that there is lot of potential," he said, adding, "Our main purpose is to make sure that we continue producing from D1 and D3. If we get the right regulatory framework, we would see much more production coming out of our blocks than what you are seeing today."
The explorers have just completed a new well at the MA field that is expected to produce from next month. Also, it is reviving three existing wells in the D1 and D3 fields in the KG basin.
Currently, the KG D6 block on the east coast produces less than 10 mmscmd.
When asked how much investment it is expecting, Mukundan said, "We are talking about somewhere around $5-$10 billion. It is important that we get the right enabling regulation to move forward."
Pricing of gas
The BP chief said it is of utmost importance for them to achieve clarity on the pricing of natural gas to go ahead with their development programmes.
"We need to have a clear pricing policy. This is important to achieve a broader development of KG D6. We have got a whole bunch of new discoveries which we need to bring on (to production). We have got an R-Series project, which is getting ready to make an investment decision. It is important we have the pricing regime understood. That is the critical bit," Mukundan added.
Meanwhile, Vivek Rae, Secretary at the Ministry of Petroleum and Natural Gas, said the Finance Ministry has sent its reponses on the issue related to pricing of natural gas.
He, however, did not divulge whether the Finance Ministry had agreed to the proposal made by his Ministry.
The Ministry for Petroleum & Natural Gas is of the view that if Reliance wants to benefit from the revised gas price, it should submit a bank guarantee for the unmet supply commitment from its KG-D6 block.
The Cabinet Committee on Economic Affairs (CCEA) will take a final decision on the issue.
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