ONGC to invest $5.3 bn in gas finds by 2013

State-run Oil and Natural Gas Corp (ONGC) will invest $5.3 billion in developing gas finds in two of its eastern offshore Krishna Godavari basin blocks to produce 25 million standard cubic meters per day of gas by 2013.

"The Directorate General of Hydrocarbons has approved our appraisal plan for the gas discoveries in deep-sea block KG-DWN-98/2. We plan to drill six appraisal wells to assess the potential and delineate the discoveries," a company official said.

The block sits next to Reliance Industries prolific KG-DWN-98/3 or D6 block. ONGC plans to tie up 10 discoveries in KG-DWN-98/2 with the G-29, GS-4 and Vashistha gas finds in a shallow water block KG-OS-DW4 in the same basin.

ONGC also plans to produce 8,000 barrels of oil per day from the fields. The reserve estimates and production plan in ONGC's appraisal programme, however, excludes ultra-deepwater UD-1 discovery in KG-DWN-98/2 block.

The UD-1 discovery alone has been certified by DGH to hold over 2 Trillion cubic feet of inplace gas reserves.

Ten discoveries in KG-DWN-98/2 (excluding UD-1) and three in adjacent blocks together hold 6.37 Tcf of inplace reserves.

Without UD-1, the block is assessed to hold just over 5 Tcf of inplace gas reserves.

ONGC has roped in Statoil of Norway and Petrobras of Brazil as equity partners in the KG-DWN-98/2. Statoil and Cairn India hold 10% each in the block and Petrobras 15 per cent, while ONGC has the remaining.

"We plan to drill six appraisal well in KG-DWN-98/2 block and three in KG-OS-DW4. Following this we will prepare a detailed development plan. As of now, we think we will need 58 wells to produce the oil and gas planned for the fields," he said.