Reliance, partners to spend Rs 22,000 cr on gas field

Energy major Reliance Industries and its partners BP and Niko Resources plan to spend $4 billion (Rs 22,000 crore) to develop satellite gas fields off India's east coast, a newspaper reported on Friday, citing company officials and government sources.

Reliance holds 60% of the D6 block, BP has 30% and the rest is held by Canadian oil and gas producer Niko.

"This is a rough estimate, but overall we plan to invest $4 billion in developing the satellite fields in KG-D6 and are hoping to submit an integrated development plan by the end of the current fiscal (year)," the newspaper quoted a senior Niko executive as saying in a conference call.

A spokesman for Reliance was not immediately available for comment.

Gas output from the D6 block has been falling. On Thursday, shares in Reliance and Niko fell after the Canadian oil producer late on Wednesday estimated that total proved plus probable reserves at the D6 block, as of March 31, had decreased to 1.93 trillion cubic feet.

The block had earlier been estimated to hold more than 9 trillion cubic feet (tcf) of gas.

The paper said Reliance was also keen to explore for more hydrocarbons that may lie beneath the field already under production.

Gas output at D6 is projected to fall to 20 million standard cubic metres a day (mscmd) in 2014/15 from 28 mscmd now.

Profits at the energy-based conglomerate have fallen for two straight quarters, and its shares now trade near a 3-year low.