ONGC looking at hiring RIL's infrastructure in KG Basin: Moily

State-owned Oil & Natural Gas Corp (ONGC) is exploring the option to hire Reliance Industries' unutilised production facilities on the east to quickly bring to production its gas finds in the Krishna Godavari basin.

ONGC "is evaluating various short-term and long-term options, including sharing of infrastructure with RIL," Oil Minister M Veerappa Moily said in a written reply to a question in the Rajya Sabha.

The company, he said, has discovered several hydrocarbon fields in different offshore and onshore areas of east coast of KG basin.

"A team of ONGC officers has been constituted to carry out technical feasibility for development of some of these fields so as to reduce cost of development and early monetisation," he said. "The studies are at preliminary stage."

ONGC has made nine gas discoveries in its KG block KG-DWN-98/2, which sits next to RIL's flagging KG-DWN-98/3 or KG-D6 block. The state-owned firm plans to club these finds with discoveries in another neighbouring block to begin gas production from 2016-17.

But instead of putting separate gas processing and transportation facilities, ONGC is looking to hire RIL's under-utilised gas gathering station at KG-D6 fields along with pipelines that take the fuel to onland as also its processing plant at Kakinada in Andhra Pradesh.

RIL has pipeline and other offshore and onshore facilities capable of handling gas output of 80 million standard cubic meters per day. It is however producing just around 17 mmscmd from the KG-D6 lock, which is way below the peak production of 69 mmscmd reached in March 2010.

RIL has indicated that KG-D6 production may never touch 80 mmsmcd due to unexpected geological complexities.

ONGC has found 4.85 trillion cubic feet of gas reserves in nine gas discoveries it has made in the Krishna-Godavari basin block KG-DWN-98/2.

The block is targeted for production by 2016-17 and a peak production of 22 mmscmd is envisaged, a company official said.

Gas from these is proposed to be produced by combining them with a gas discovery in the adjacent block, he said.

G-4 gas discovery in a neighbouring block is planned to be developed along with finds in the Northern Discovery Area of KG-DWN-98/2.

The Northern Discovery Area (NDA) consists of the Padmawati, Kanakadurga, Annapurna, D/KT, U, A, W and E gas finds in in water depths ranging from 594 metres to 1,283m. The Southern Discovery Area consisting of the UD-1 discovery falls in ultra-deepwater with a depth of 2,841 m.