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RIL discovers gas in Mahanadi basin block

Last Updated: Friday, August 14, 2009 - 15:05

New Delhi: Reliance Industries has found
natural gas reserves in a well drilled on its NEC-25 block in
Mahanadi basin, off the Orissa coast, the company`s junior
partner Niko Resources of Canada said on Friday.

Gas was discovered in the well AJ2 last month,
Toronto-listed Niko said in a regulatory filing.

A source in know of the development said this is not a
new discovery but appraisal of earlier gas finds. "AJ2 is an
appraisal well drilled to access the potential in the previous
A6 and J1 discoveries. Gas was struck in AJ2 but it is not a
new pool."

Since AJ2 is an appraisal well and not a new discovery,
RIL -- the operator of the block NEC-OSN-97/2 or NEC-25 -- has
not made any announcement.

Niko Resources holds 10 per cent interest in the Mahanadi
basin shallow water block covering an area of 10,755 sq km in
water depths ranging between 20-600 meters. RIL holds 90 per
cent interest in the Bay of Bengal block.

RIL has so far made eight gas discoveries in NEC-25, off
which six were declared commercially exploitable and
development plan submitted to the Directorate General of
Hydrocarbons (DGH) in 2007.

Field Development Plan (FDP) is investment proposal for
bringing to production oil or gas finds. Operators like RIL
can only begin such investments after getting the necessary
approval from DGH, the sector regulator.

Niko did not give potential reserves in the AJ2 well but
the source said the discovery "looks promising".

"Approximately 1,000 square kilometers of 3D seismic have
been acquired along the central portion of the northwest
boundary of the previous 3D survey," the Canadian firm said.

The discoveries in NEC-25 are besides the 19 gas and one
oil find RIL made in the Krishna Godavari basin deepsea block
KG-DWN-98/3 or KG-D6. Of these, two gas finds were put to
production in April this year and are currently producing
36.25 million standard cubic metres per day.

The MA oil discovery in KG-D6 started output in September
2008 and is currently producing 13,000 barrels per day.

Niko, which holds 10 percent interest in KG-D6, said oil
production is targeted to reach up to 35,000 bpd before March
Gas output would touch 80 mmscmd before year-end, it

Bureau Report

First Published: Friday, August 14, 2009 - 15:05

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