RIL proposes to drill exploration well in KG-D6 at own cost

Desperate to reverse the falling output at its KG-D6 block, Reliance Industries Ltd (RIL) has proposed to drill the first exploration well in almost five years in the flagging gas fields at its own cost.

The Dhirubhai-1 and 3 (D1&D3) gas fields, the largest among the 18 gas finds on the

KG-D6 block, have proved to be more difficult to produce than previously predicted and RIL now wants to drill a probe well on the fields to study reservoir characteristic, sources said.

Fearing that the petroleum ministry may not give permission to drill exploratory well ‘MJ1’, RIL has proposed to sink the well on sole-risk basis. Sources said RIL, as a one-time exception, is willing to drill at its sole risk and cost recover only if the discoveries are assessed to be commercial.

RIL believes exploration well is clearly allowed in any mining lease area under law and the production sharing contract also supports it.