RIL and BP Invest More Than INR 7,000 Crore in KG-D6 Block

Reliance Industries Limited (RIL) and its UK fuel partner BP have spent more than INR 7,000 crore to keep operations ongoing in the D1 and D3 gas fields of the KG-D6 block. This is in preparation of new fields that are expected to begin production in mid-2020.

Details of the D1 and D3 fields

The (Dhirubhai-1 and 3) D1 and D3 gas fields are the first of 18 gas discoveries in KG-D6. They commenced production in April 2009.
RIL and BP have spent more than INR 7,000 crore to sustain production in these gas fields using a combination of complex techniques such as inlet pressure and surfactant. These gas fields would have ceased production much earlier due to sand and water ingress, which was sooner than expected and higher than anticipated. This occurred in the second half of 2010.

Nearing the completion of their production life, these two gas fields are being kept operational to preserve the facility for use by three new projects, which are R-Series, Satellite, and MJ fields. RIL and BP aim to keep D1 and D3 running till the Satellite and R-Series fields in the KG-D6 block can begin production. The plan is to utilize existing facilities to produce 30-35 million metric standard cubic meters per day (mmscmd) of peak output from the three aforementioned new fields.

By the end of 2019, D1 and D3 will cease production.

Progress with three new gas fields

The shutdown of D1 and D3 will coincide with the modification, preparation, and upgradation of facilities and operating systems to connect the new fields. Sources close to the working of this project stated that R-Series might likely give first gas by mid-2020. The output from Satellite and MJ fields may begin in 2021 and 2022 respectively.

RIL’s presence in the Krishna Godavari basin

To date, Reliance Industries has made 19 gas and oil discoveries in the Krishna Godavari basin. The only oil discovery within the block, Dhirubhai-26 (D26) or MA, was the first ever to produce in September 2008. Following this, D1 and D3 went on-stream in April 2009.

Sources have stated that the MA field is expected to end production by September 2018. It had reached its peak of 108,418 tonnes of oil in May 2010. It also started producing gas when D1 and D3 went live in April 2009.  D1 and D3 had their peak in March 2010 with an output of 61.4 mmscmd. The KG-D6 output in April-June saw an average of 4.7 mmscmd. This was from the production at both D1 and D3 and MA fields.

Stakes in the KG-D6 block

As the operator of the KG-D6 block, RIL holds 60 percent interest in it. BP plc of the UK holds a 30 percent stake, while Niko Resources of Canada holds the remaining 10 percent. For the development of D26 or MA oilfield, RIL proposed an investment of USD 1.96 billion in 2012.

Summary: Reliance and BP have spent more than INR 7,000 crore to keep operations ongoing in the D1 and D3 gas fields of the KG-D6 block. The output from these fields will be used to facilitate production is three new fields.

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