ONGC: Will our gas stray to RIL's?

Asks PetroMin to check if its K-G block allotment isn't too close to RIL's wells to enable such exodus

ONGC Ltd has asked the petroleum ministry’s directorate general of hydrocarbons (DGH) whether its G4 gas field in the Krishna-Godavari basin is geologically linked to the KG-D6 reservoir of Reliance Industries Ltd (RIL).

If there is a flow from ONGC’s side to KG-D6, the government-owned company wants its share to be returned or compensated, said a top  executive.

“This is a standard practice globally. Whenever two operators are working on neighbouring blocks, they are supposed to share geo-scientific data. We have asked for this because once we start production of the G4 gas field near the RIL block in 2016, there is a chance of leakage if the blocks are linked,” P K Borthakur, director (offshore) at ONGC, told Business Standard. “An expert would be appointed to come up with a feasibility study on the possibility of sharing the facilities and a decision would be taken soon.”  

ONGC had earlier raised a query on its gas overflowing to Niko Resources’ block in Surat. “Though Niko had denied it, (we are) looking into the issue,” said a senior petroleum ministry official.

R S Sharma, former chairman of ONGC and head of the hydrocarbon committee at the Federation of Indian Chambers of Commerce and Industry, said: “I have never heard of such a practice till now. In my career time, directly or indirectly, none of the geologists have mentioned about the possibility of one company drawing gas from another block.”

RIL’s Krishna-Godavari block is close to ONGC’s DWN 98/2 one. RIL and ONGC had even signed a memorandum of understanding to share the unutilised infrastructure facilities of the former at KG-D6. ONGC had made nine discoveries, an estimated 4.8 trillion cubic feet of gas, in its KG-DWN-98/2. It has a conservative estimate to produce six to nine million standard cubic metres a day of gas by mid-2017 from KG-DWN D & E fields in the first phase. Though the RIL facilities were supposed to handle about 80 mscmd, the production has come down to about 14 mscmd for technical reasons.