Reliance Industries has cut estimate of natural gas reserves of its eastern offshore KG- D6 block by a little less than 7 per cent, leaving over 6 trillion cubic feet of reserves still left to be recovered.
RIL in i
ts annual report for 2011- 12 stated that its deepsea Krishna Godavari basin block had 206.46 billion cubic meters of reserves. Of this, it transferred 56.621 bcm to BP Plc when the British firm bought 30 per cent interest in KG- D6 and 20 other blocks for USD 7.2 billion.
Besides, it revised the proved reserves in the area downwards by 12.418 bcm because the reservior had not behaved the way it should have, leading to output droping more than 40 per cent to about 34 million standard cubic meters per day over the past two years.
After the revision, transfer to BP and production during the year, RIL in the report said it closed the 2011- 12 fiscal with 103.958 bcm of reserves against its 60 per cent interest in the block.
This translates into 3.67 Tcf of balance proved reserves for the equivalent of RILs share ( 6.11 Tcf for the 100 per cent of area).
RIL Chairman and Managing Director Mukesh Ambani, in the letter to company shareholders, said: ” Production from the KG- D6 block has been adversely impacted mainly due to unforeseen reservoir complexities and water ingress in the producing fields.” ” Significant steps have been taken by the joint technical teams ( of RIL and BP) in assessing options for overall reservoir management based on which, an integrated plan for work- overs and additional wells can be executed, subject to necessary regulatory and government approvals.” Based on the production data as compared to the original production geological , validated by experts, it appears that the decline in pressure / production has been higher than originally predicted, volumes connected to existing wells is lower than envisaged and gas outside the main channel was in small uneconomic volumes and not participating in production.
Oil Minister S Jaipal Reddy said RILalt39 KG- D6 gas fields are likely to see output to all- time low of 20 million standard cubic meters per day in 2014- 15, Oil Minister S Jaipal Reddy said.