DGH backs ONGC demand for expert in KG basin issue

The upstream regulator, Directorate General of Hydrocarbon (DGH) has backed Oil and Natural Gas Corp (ONGC)’s demand for appointment of an international expert to assess if Reliance Industries Ltd (RIL) was drawing out any of its gas in the KG basin.

ONGC says at least three wells drilled by RIL in the eastern offshore KG-D6 block are within “few hundred meters” of its gas fields and it fears the two may be sharing the same pool of reservoir.

Since it has not yet begun producing from its side, ONGC feels RIL wells may be pumping out its share of gas.

The DGH has asked RIL to immediately share data on the gas reservoir on its side of the block as well as production flows with ONGC, sources privy to the development said.

It also asked ONGC to share data based on which it had felt that RIL’s wells — D6-A5, D6-A9 and D6-B8 in KG-D6 block may be drawing gas from its gas pools called G4-2, G4-3 and D-1.

The DGH letter to RIL follows ONGC’s February 11 complaint to the oil ministry, saying the Mukesh Ambani-run firm was unwilling to cooperate and was delaying the process of resolving the issue which it had raised more than seven months back.

“In view of significance of the issue and ONGC’s position that there is continuity of discoveries made by ONGC in its Godavari PML and KG-DWN-98/2 block and possible extension of reservoirs into KG-DWN-98/3 (KG-D6) block, RIL, the contractor of KG-DWN-98/3 block is reminded and advised to comply with the provisions of contract and fully cooperate with ONGC to resolve the concerns of ONGC,” DGH wrote.

It asked both RIL and ONGC to submit a joint study report to DGH at the earliest.

Sources said RIL was also advised to consider ONGC’s proposal for resolving the issue through an independent study by engaging third party.

ONGC fears that gas pool in its nomination block G4 (Godavari PML) and KG-DWN-98/2 extends into KG-D6.

Based on the data provided by RIL studied so far, the position of ONGC is that there is a continuity of discoveries made by ONGC in its Godavari PML and KG-DWN-98/2 Block and possible extension of reservoirs into RIL’s KG-DWN-98/3 Block.  

“Our study suggests that RIL's well D6-A5, D6-A9 and D6-B8 are drilled on the extension of G4-2, G4-3 and D-l pools of ONGC, respectively. As these pools are extending across both the blocks, there is possibility that pools of KG-DWN-98/2 and G4 are being drained through wells drilled in D-6 block, as these wells are drilled close to/on block boundary,” ONGC had written to DGH.

It wanted appointment of a third party independent expert to resolve the issue.