RIL may see 31% jump in KG-D6 output in 6 months

Company says it will drill 8 development wells on D34 and lay a pipeline to take the gas to the existing facilities of D1-D3 fields

In the next six months, natural gas production from Reliance Industries Ltd (RIL)’ flagship KG-D6 block in the Krishna-Godavari basin could rise 31% to 17 million standard cubic metres a day (mscmd), against the current 13 mscmd.

In the quarter ended September this year, production from the block declined to 14 mscmd from 15 mscmd in the previous quarter.

“The RIL management guided for production increase from the current 13/14 mscmd to 17 mscmd in the MA field (in KG-D6) in the December 13-March 14 period, led by MA-8/MA-6 wells,” Motilal Oswal said in its report on RIL.

 

With work-over and sidetracking operations planned through the third and fourth quarters of this financial year, the field was likely to stabilise; production should rise owing to the commissioning of a booster compressor in D1-D3 and the integration of the MA 8 well being drilled in the MA field, said Nitin Tiwari, energy sector analyst at Religare Capital Markets Ltd.

Currently, two rigs are under operation---Rig DDKG2 (drilling the MA-8 development well in the MA field) and Rig DD KG1 (drilling the appraisal well D6 MJ1- A1).

After announcing its earnings for the quarter ended September, RIL, at an investor presentation, said it planned to invest $3.2 billion in its D34 discovery, which held 1.2-1.4 trillion cubic feet of reserves. The field would start production in four years, with a peak output of 12 mscmd. The D34 find was made in 2007 and a field development plan was submitted to authorities in January this year. The investment plan was approved by the management committee in August 2013, RIL said.

The reserves in the D34 discovery are a third of the revised volumes at the main Dhirubhai-1 and 3 (D1&D3) gas fields in KG-D6 block. The envisaged peak output is more than D1 & D3’s current production of 10 mscmd.

RIL said it would drill eight development wells on D34 and lay a pipeline to take the gas to the existing facilities of D1-D3 fields. D34 is part of the R-cluster of discoveries, which includes D-29, 30 and 31. Of these, only D34 has been declared commercially viable so far.

RIL and its partner BP are investing $1.529 billion in four other satellite fields that can produce 10 mscmd.