Best printers for Home

Best Mixer Grinder

Best wired Earphones

Best 43 Inch TV in India

Best Wi Fi Routers

Best Home Theatre in India

Smart Watch under 5000

Best Laptops for Education

Best Laptop for Students

<keyword id="19938772" type="General" weightage="20" keywordseo="Reliance-Industries-Ltd" source="keywords" meta.keywordsubtype="org" meta.entityname="Reliance Industries Ltd" meta.hostid="153" meta.entityid="Reliance Industries Ltd">Reliance Industries Ltd</keyword> has got <keyword id="20556884" type="General" weightage="20" keywordseo="government-approval" source="keywords">government approval</keyword> for making additional investments in developing gas reserves in its <keyword id="21402331" type="General" weightage="20" keywordseo="KG-D6" source="keywords">KG-D6</keyword> block in the <keyword id="19929177" type="General" weightage="20" keywordseo="Bay-of-Bengal" source="keywords">Bay of Bengal</keyword> that can add 4 to 5 million standard cubic meters per day to the production, a company official said. Reliance and its partner bp Plc currently produce around 30 mmscmd or about 30 per cent of India's gas production, from the KG-D6 block. At an investors' call announcing the fourth quarter earnings, Sanjay Roy, senior vice-president for exploration and production at <keyword id="19896380" type="General" weightage="20" keywordseo="Reliance-Industries" source="keywords">Reliance Industries</keyword> Ltd, said the development plan for incremental production has been approved by the government. "One good aspect of this quarter gone by was that we had an incremental development plan approved by the government, which has the potential to deliver incremental production of 4 to 5 million standard cubic meters (per day) in the coming few years, which would augment the production that we have," he said. He, however, did not give details of the investment approved. Reliance-bp produces some 30 mmscmd of gas from three sets of discoveries in the deep-sea KG-DWN-98/3 or KG-D6 block, the last - MJ oil and gas field - being put into production in May 2023. All three sets of discoveries, with MJ being the deepest, were made more than a decade back and have been progressively put into production. Prior to that, they had brought the R-Cluster field to production in December 2020 and the Satellite Cluster in April 2021. KG-D6 has helped domestic production of natural gas, which is used to generate electricity, make fertilizer or turned into CNG for running automobiles or piped to kitchens for cooking, touching a multi-year high of 99 mmscmd. Total gas demand in the country is around 188 mmscmd, with the difference being met through imports. "When we look at the (domestic) production, we can see clearly there's been a sharp increase in production since FY21. And although the overall domestic production, besides KG-D6, has been flat, KG-D6 production is almost 90 per cent of the incremental domestic gas production," Roy said. Reliance is the operator of the KG-D6 block with a 66.67 per cent stake and bp holds the remaining 33.33 per cent. Reliance has so far made 19 gas discoveries in the KG-D6 block. Of these, D-1 and D-3 -- the largest among the lot -- were brought into production in April 2009, and MA, the only oilfield in the block, was put into production in September 2008. While the MA field stopped producing in September 2018, output from D-1 and D-3 ceased in February 2020. Since then, Reliance-bp invested USD 5 billion in bringing to production three deepwater gas projects in block KG-D6 -- R-Cluster, Satellites Cluster, and MJ. The MJ field is located about 2,000 metres directly below the Dhirubhai-1 and 3 (D1 and D3) fields. It is a high-pressure and high-temperature (HPHT), gas and condensate field. Besides gas, it is to produce 25,000 barrels of condensate per day at peak. SEE ALSO:<a href="https://www.businessinsider.in/tech/mobile/news/google-pixel-8a-may-be-more-expensive-than-its-predecessor-as-per-a-new-leak/articleshow/109499394.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/mobile/news/google-pixel-8a-may-be-more-expensive-than-its-predecessor-as-per-a-new-leak/articleshow/109499394.cms" target="_blank">Google Pixel 8a may be more expensive than its predecessor, as per a new leak</a><a href="https://www.businessinsider.in/tech/mobile/webstories/best-smartphones-under-25000-in-india/slidelist/109529634.cms" target="_blank"></a> <a href="https://www.businessinsider.in/tech/mobile/webstories/best-smartphones-under-25000-in-india/slidelist/109529634.cms" target="_blank">Best smartphones under ₹25,000 in India</a><a href="https://www.businessinsider.in/sports/webstories/at-17-indian-chess-prodigy-d-gukesh-becomes-youngest-challenger-for-world-championship/slidelist/109492021.cms" target="_blank"></a> <a href="https://www.businessinsider.in/sports/webstories/at-17-indian-chess-prodigy-d-gukesh-becomes-youngest-challenger-for-world-championship/slidelist/109492021.cms" target="_blank">At 17, Indian chess prodigy D Gukesh becomes youngest challenger for World Championship</a>

Reliance Industries wins govt nod for additional investment to raise KG-D6 gas output

<keyword id="6358777" type="LOCATION" weightage="20" keywordseo="New-Delhi">New Delhi</keyword>, <keyword id="6355199" type="DOMAIN" weightage="20" keywordseo="reliance-industries">Reliance Industries</keyword> Limited (RIL) and BP Exploration Alpha Limited (BPEAL) have invited <keyword id="48985" type="PERSON" weightage="20" keywordseo="Bids">bids</keyword> through an online platform companies for the <keyword id="6355653" type="UNKNOWN" weightage="20" keywordseo="gas">gas</keyword> produced from the <keyword id="187231" type="PERSON" weightage="20" keywordseo="KG-D6-Basin">KG D6 basin</keyword> in Kakinanda. In a <keyword id="1176272" type="PERSON" weightage="20" keywordseo="public-notice">public notice</keyword>, RIL and BP while inviting bids said they expect to sell the gas from February 1, 2021. "The gas produced for KG D6 will be available for sale at the delivery point at Gadimoga near Kakinada, Andhra Pradesh tentatively from 01 February 2021," RIL and BP said in the notice. Crisil Risk and Infrastructure Solutions has been appointed by the consortium to conduct the bidding process for sale of gas through an online web based electronic bidding platform. The consortium is currently producing and developing deep water gas fields under the production sharing contract with the government. Earlier this month, RIL and BP had announced the start of production from the R Cluster, ultra-deep-water gas field in block KG D6 off the Kakinada coast. RIL and BP are developing three deepwater gas projects in block KG D6  R Cluster, Satellites Cluster and MJ  which together are expected to meet 15% of <keyword id="3658" type="LOCATION" weightage="20" keywordseo="India">India</keyword>'s gas demand by 2023. These projects will utilise the existing hub infrastructure in KG D6 block. RIL is the operator of KG D6 with a 66.67% participating interest and BP holds a 33.33% participating interest. R Cluster is the first of the three projects to come onstream. The field is located about 60 kilometers from the existing KG D6 Control &amp; Riser Platform (CRP) off the Kakinada coast and comprises a subsea production system tied back to CRP via a subsea pipeline. Located at a water depth of greater than 2000 meters, it is the deepest offshore gas field in Asia. The field is expected to reach plateau gas production of about 12.9 million standard cubic meters per day (mmscmd) in 2021. SEE ALSO: <a href="https://www.businessinsider.in/india/news/these-are-some-important-changes-in-india-from-january-1-2021-new-year/articleshow/80021085.cms">From mandatory FAStag to quarterly GST returns — these are some important changes in India from January 1</a> <a href="https://www.businessinsider.in/business/auto/news/heres-what-to-expect-from-maruti-mm-hero-bajaj-auto-and-other-automakers-in-december-month-2020-auto-sale/articleshow/80021695.cms">December auto sales estimates — Here’s what to expect from Maruti, M&amp;M, Hero, Bajaj Auto, and other automakers</a> <a href="https://www.businessinsider.in/tech/apps/news/google-is-testing-a-shortcut-feature-for-tiktok-and-instagram-videos/articleshow/80021865.cms">Google is testing a shortcut feature for TikTok and Instagram videos</a>

RIL and BP expect to sell gas from KG-D6 deep water blocks starting February

New Delhi, Feb 9 () Reliance Industries and its partner BP plc of UK will this month offer for sale more natural gas from its KG-D6 block to users as it prepares to put into production second wave of discoveries in the eastern offshore block. Reliance-BP is likely to offer as much as 5 million standard cubic meters per day (mmscmd) of natural gas for bidding from newer discoveries in KG-D6 in next few days, sources aware of the development said. The volume to be offered is the same as the one the company bid out in November last year. E-mails sent to Reliance and BP for comments remained unanswered. Like in the previous auction, Reliance-BP will seek bids from potential users for the 5 mmsmcd of natural gas it plans to produce from the R-Cluster Field in KG-D6 block from mid-2020. Bidders will have to quote a price (expressed as a percentage of the dated Brent crude oil rate), supply period and the volume of gas required. Dated Brent means the average of published Brent prices for three calendar months immediately preceding the relevant contract month in which gas supplies are made. Sources said Reliance had in November set a floor or minimum quote of 8.4 per cent of dated Brent price -- which meant that bidders had to quote 8.4 per cent or a higher percentage for seeking gas supplies. The same formula is likely to be continued in the next auction. In the first round of auction in November 2019, Essar Steel, Adani Group and state-owned GAIL bought a majority of volumes on offer at a price of USD 5.1-5.16 per unit. Essar Steel had picked up 2.25 mmscmd in the country's first transparent and dynamic forward auction that lasted about five-and-half-hours on November 15, 2019, sources said. Gujarat State Petroleum Corp (GSPC) picked up 1.2 mmscmd while Adani Group and Mahanagar Gas Ltd bought 0.3 mmscmd, sources said, adding GAIL, acting on behalf of fertiliser companies, bought 0.3 mmscmd of gas. Hindustan Petroleum Corp Ltd (HPCL) had bought 0.35 mmscmd and 0.10 mmscmd went to Gujarat State Fertilizers &amp; Chemicals Ltd (GSFC)/Gujarat Narmada Valley Fertilizers &amp; Chemicals Ltd (GNFC), sources said. In all, 15 customers across sectors such as steel, petrochemicals, city gas, glass and ceramic got gas in the tender, they added. In the November 15 auction, bidders quoted between 8.5 and 8.6 per cent slope to corner all of the 5 mmscmd supplies available. This translates into a price between USD 5.1 per mmBtu and USD 5.16 per mmBtu rate at Brent oil price of USD 60 per barrel. Initially, Reliance had set a floor quote of 9 per cent of dated Brent price, which translated into a gas price of USD 5.4 per mmBtu at USD 60 oil price. But consumers saw this as a very high price considering that imported LNG in the spot market is available at around USD 4 per mmBtu rate currently. To pacify the consumers, Reliance lowered the floor/minimum quote to 8.4 per cent of dated Brent price. Reliance and BP are developing three sets of discoveries in KG-D6 block -- R-Cluster, Satellites, and MJ by 2022. R-Cluster will have a peak output of 12 mmscmd while Satellites, which are supposed to begin output from mid-2021, would produce a maximum of 7 mmscmd. MJ field will start production in second half of 2022 and will have a peak output of 12 mmscmd. Reliance has so far made 19 gas discoveries in the KG-D6 block. Of these, D-1 and D-3 -- the largest among the lot -- were brought into production from April 2009 and MA, the only oilfield in the block was put to production in September 2008. While the MA field stopped producing last year, the output from D-1 and D-3 ceased to produce this month. Other discoveries have either been surrendered or taken away by the government for not meeting timelines for beginning production. Reliance is the operator of the block with 66.6 per cent interest while BP holds the remaining stake. ANZ ANUANU

Reliance-BP to auction more gas from KG-D6 block this month

New Delhi, Feb 3 () D1/D3 gas field, India's first deepwater gas field, ceased to produce on Monday after a USD 1 billion investment and mammoth technological intervention by Reliance Industries and its partner BP Plc of UK extended the life of dwindling fields by four years, sources said.
D1/D3 field, in Block KG D6 (KG-DWN-98/3) located in the Bay of Bengal, was India's first deepwater gas field to be put on production in April 2009. Output, which peaked at over 61 million standard cubic meters per day in 2010, had been on a decline as sand and water ingress forced wells to shut down one after the other.
While at the peak, it was India's biggest gas field, in the last quarter D1/D3 produced an average of just 1.5 mmscmd.
The sources said only three out of the 18 wells drilled on the fields had remained on production and they too died on Monday.
In perhaps one of its kind intervention in a deepsea field, Reliance-BP, through use of a combination of complex techniques, kept the wells flowing at Dhirubhai-1 and 3 (D1&amp;D3) fields for the last four years.
Reliance had to date made 19 oil and gas discoveries in the Krishna Godavari basin. Of these, D26 or MA -- the only oil discovery in the block -- was the first field to began production in September 2008. D1 and D3 fields went onstream in April 2009.
MA field cessation expected by September 2018, the sources said, adding the field at its peak had produced 1,08,418 tonnes of oil in May 2010.
MA also started producing gas from April 2009, just when D1 and D6 went live. It peaked to 8.4 mmscmd in August 2010 before sand and water ingress forced shutting down of well after well. D1 &amp; D3 field too had a peak that year in March when it touched an output of 61.4 mmscmd.
KG-D6 produced about 3 trillion cubic feet equivalent, saving about USD 30 billion in energy imports.
The sources said the field infrastructure would be utilized to bring on stream the next set of fields in the block.
The joint venture has committed USD 5 billion (Rs 35,000 crores) of investments towards monetizing another 3 trillion cubic feet equivalent (about 500 Million Barrels of Oil equivalent) reserves from three projects - R cluster, Satellite Cluster and MJ fields.
These projects will be utilizing most of the existing gas production facilities, they said, adding once commissioned, the three fields will deliver a peak production of 1 billion cubic feet per day which is about 20 per cent of the current domestic production.
Although there were initial setbacks due to geological surprises, the challenge was to extend life of the field beyond 2015 due to lower reservoir pressure and water ingress, the sources said.
Reliance-BP innovated and applied first of their kind solutions to extend field life and maximize recovery, which included sidetrack/substitute wells, reduction of arrival pressures, and mitigating the effect of water in the network.
This effort extended production up till this month.
The sources said despite best efforts, in recent times the field instability exacerbated due to water and sand ingress leading to a sharp decline in production. Consequently, to preserve the facilities for future use, the field had to be safely shutdown on Monday.
The field set several global benchmarks set in terms of deepwater operational performance - 99.9 per cent uptime, 100 per cent incident-free operations and no security incident.
Reliance is the operator of KG-D6 block with 66.6 per cent stake, while BP has the balance. ANZ BAL

D1/D3 gas field in Reliance's KG-D6 block shuts down

New Delhi, Jun 28 () Reliance Industries has pushed back the start of production from the second wave of discoveries in its eastern offshore KG-D6 block to September/October after the COVID-19 lockdown imposed unprecedented constraints in execution of the deepwater project. The company, along with its partner BP Plc of the UK, was initially targeting the start of production from the R-Series field in the Krishna Godavari block in May but pushed it back to June-end due to the lockdown. The lockdown has further pushed the start of production to mid of 2020-21 fiscal, Reliance said in its latest annual report. Fiscal year runs from April to March and mid of the fiscal should be September or October. In its annual report, Reliance said the key focus for 2019-20 was to monetise the about 3 trillion cubic feet equivalent of discovered resources in KG-D6 deepwater. "Concurrent development of three deep/ultra-deepwater projects in block KG-D6 namely, R-Cluster, Satellite Cluster and MJ fields, is being pursued by leveraging the existing world class hub infrastructure. "All contracts have been awarded and projects are in different stages of maturity with commissioning of the first of the three projects i.e. R Cluster, expected this year," it said. Combined production from these three fields is expected to be 30 million standard cubic metres per day (mmscmd) by FY2024. The output is equal to a third of India's current natural gas production. "Up until March 2020, all projects have been ahead of schedule. However, the outbreak of the COVID-19 pandemic and consequent lockdowns have presented unprecedented constraints in the execution of these deepwater projects. "While safety of people and assets remains our top priority, we are making all efforts to progress these projects and expect to commission the R-Cluster Field in mid FY 2021," the company said. The company's D1 and D3 fields in the KG-D6 block ceased to produce in February this year after being in production for a decade. R-Cluster will have a peak output of 12.9 mmscmd while Satellites, which are supposed to begin output from mid-2021, would produce a maximum of 7 mmscmd. MJ field will start production in the second half of 2022 and will have a peak output of 12 mmscmd. "The R-Cluster fields which will come onstream first, will have a peak production of 12.9 mmscmd, about 10 per cent of India's current gas production. The combined production from the three fields will ramp up to 30 mmscmd in 2023 when all the fields are onstream," it said. Reliance said with a significant gas resource base, it is poised to be a premier contributor to India's gas-based economy. "Within three years, we are aiming to achieve peak production of gas that will be equivalent to nearly 30 per cent of India's indigenous production. This will translate into substantial multiplier effects for the economy and lead to energy import savings to the tune of nearly USD 25 billion over 10-12 years," the annual report added. The peak production from the three fields is expected to reach about 15 per cent of India's projected demand that year, it said. The D1-D3 field was India's first deepwater gas field to be put on production in April 2009. "While there were initial setbacks due to geological surprises, the RIL-BP joint venture through its efforts and further investments extended the field life upto February 2020, maximising recovery from the field," it said. The KG-D6 Block has so far produced an overall 3 trillion cubic feet equivalent of gas, oil and condensate. The block has established several global benchmarks in terms of operational performance, including 99.9 per cent uptime and 100 per cent incident-free operations. "Majority of the production facilities established for development of the gas fields will be utilised towards development of the three new fields," it added. ANZ ABM

Reliance pushes back KG-D6 production to Sep/Oct

<ul><li><keyword id="10926" type="CITY" weightage="20" keywordseo="Reliance">Reliance</keyword> Industries and <keyword id="32848" type="ORGANIZATION" weightage="20" keywordseo="BP">BP</keyword> have started the production from the R Cluster, ultra-deep-water gas field in block KG D6 off the east coast of India.</li><li>KG D6, which is the Krishna Godavari Dhirubhai 6, was Reliance’s first offshore gas field development. </li><li>Located at a water depth of over 2000 meters, it is the deepest offshore gas field in Asia, according to the company. </li></ul>Reliance Industries and BP have started the production from the R Cluster, ultra-deep-water gas field in block KG D6 off the east coast of India. The oil fields in the Krishna-Godavari basin, popularly known as KG-D6, was Reliance’s first offshore gas field development. Discovered in 2002, the KG D6 is also India’s largest deposit of natural gas. Through the three clusters of Reliance in KG D6 – R Cluster, Satellites Cluster and MJ, Located at a water depth of greater than 2000 meters, it is the deepest offshore gas field in Asia, the company said in a statement. . The Mukesh Ambani-led company hopes to produce 15% of India’s total gas consumption. According to <a href="https://www.businesstoday.in/current/corporate/ril-bp-set-start-gas-production-r-series-invest-rs-40000-crore/story/423436.html">reports</a>, production from Satellites Cluster and MJ is expected to begin in FY22. “This is a significant milestone in India's energy landscape, for a cleaner and greener gas-based economy. Through our deep-water infrastructure in the Krishna Godavari basin we expect to produce gas and meet the growing clean energy requirements of the nation,” said <keyword id="3820" type="PERSON" weightage="20" keywordseo="Mukesh-Ambani">Mukesh Ambani</keyword>, Chairman and Managing Director of Reliance Industries Limited in a statement. Reliance and bp are together investing ₹40,000 crore into KG-D6. Earlier, BP had invested $1 billion for a 49% stake in the joint venture called “Jio-bp”, with <keyword id="6484187" type="COMPANY" weightage="20" keywordseo="ril">RIL</keyword> holding 51%. SEE ALSO: <a href="https://www.businessinsider.in/business/news/ikea-india-cfo-says-she-still-has-3500-crore-to-be-spent-in-india-the-pandemic-has-changed-targets-but-not-the-investment-plan/articleshow/79790938.cms">INTERVIEW: Ikea CFO says she still has ₹3,500 crore to be spent in India⁠— the pandemic has changed targets but not the investment plan</a> <a href="https://www.businessinsider.in/science/health/news/india-will-produce-300-million-doses-of-the-russian-sputnik-v-covid-19-vaccine-next-year/articleshow/79795341.cms">India will produce 300 million doses of the Russian Sputnik V COVID-19 vaccine next year</a> <a href="https://www.businessinsider.in/business/ecommerce/news/flipkart-shares-new-data-how-the-indian-heartland-is-turning-into-a-business-for-the-e-commerce-giant/articleshow/79792821.cms">Flipkart shares new data on how the Indian heartland is turning into a big business for the e-commerce giant</a>

Reliance and BP start production from KG-D6 oil field – off the coast of Kakinada

<ul><li>Natural gas output from <keyword id="937512" type="COMPANY" weightage="20" keywordseo="Dhirubhai-1">Dhirubhai-1</keyword> and 3 gas fields in the KG-D6 block in the Bay of Bengal started to lag <keyword id="9280858" type="UNKNOWN" weightage="20" keywordseo="company-projections">company projections</keyword> from the second year of production itself in 2010 and the field ceased to produce in February this year much ahead of its projected life. </li><li>The government blamed the phenomenon to the company not sticking to the approved development plan and disallowed over USD 3 billion costs. The company disputed this and dragged the government to arbitration. </li><li>While the two sides have filed their respective pleadings before the three-member arbitration tribunal, final hearings are tentatively scheduled from September to December 2021. </li></ul> <keyword id="6355199" type="COMPANY" weightage="20" keywordseo="reliance-industries">Reliance Industries</keyword> has estimated a maximum liability of USD 400 million (₹3,000 crore) in its nine-year old dispute with the government over alleged under-utilisation of capacity at the KG-D6 field due to failure to comply with an approved investment plan. Natural gas output from Dhirubhai-1 and 3 gas fields in the KG-D6 block in the Bay of Bengal started to lag company projections from the second year of production itself in 2010 and the field ceased to produce in February this year much ahead of its projected life. The government blamed the phenomenon to the company not sticking to the approved development plan and disallowed over USD 3 billion costs. The company disputed this and dragged the government to arbitration. In its mega rights issue offer document, Reliance said the central government sent notices to the firm and its partners in the KG-D6 block "disallowing cost recovery for alleged under-utilisation of capacity due to failure to comply with the approved development plan and demanded an additional share of profit petroleum." "The company contended that there are no provisions in the KG-D6 contract which entitle the Central Government to disallow cost recovery on this basis," it said. <keyword id="9280859" type="COMPANY" weightage="20" keywordseo="the-production-sharing-contract">The Production Sharing Contract</keyword> or PSC allows contractors to recovery all their capital and operating cost from the sale of oil and gas discovered and produced from a block before sharing profits with the government. Disallowing certain costs for recovery leads to the government claiming higher profit share. "On November 23, 2011, our company served an arbitration notice on the Central Government seeking to resolve a dispute relating to the cost recovery provisions of the KG-D6 PSC," the firm said. While the two sides have filed their respective pleadings before the three-member arbitration tribunal, final hearings are tentatively scheduled from September to December 2021. "Our potential liability in respect of, or the financial impact of this proceeding on our company, if any, pertains to the additional profit petroleum alleged to be payable to the Central Government, and is estimated to be in the range between USD 200 million and USD 400 million," it said, adding the matter is currently pending. Gas output from D1 and D3 fields in KG-D6 block was supposed to be 80 million standard cubic metres per day but actual production was only 35.33 mmscmd in 2011-12, 20.88 mmscmd in 2012-13 and 9.77 mmscmd in 2013-14. The output continued to drop in the subsequent years and the fields ceased to produce in February this year. "The Government of India (GOI), by its letters dated May 2, 2012, November 14, 2013, July 10, 2014, and June 3, 2016, has disallowed certain costs which the Production Sharing Contract (PSC), relating to Block KGDWN-98/3 (KG-D6) entitles the company to recover. "The company continues to maintain that a contractor is entitled to recover all of its costs under the terms of the PSC and there are no provisions that entitle the GOI to disallow the recovery of any contract cost as defined in the PSC," it said. In these four notices, the government sought USD 247 million (Rs 1,869 crore) of additional profit petroleum after cost recovery was disallowed. The total penalty slapped till 2016, which was in the form of disallowing recovery of cost incurred for missing the target during six years beginning April 1, 2010, was USD 3.02 billion. The PSC allows Reliance and its partners <keyword id="111764" type="COMPANY" weightage="20" keywordseo="BP-Plc">BP Plc</keyword> of the UK and Canada's Niko Resources to deduct all capital and operating expenses from the sale of gas before sharing profit with the government. <keyword id="579522" type="COMPANY" weightage="20" keywordseo="Reliance-BP">Reliance-BP</keyword> had blamed unanticipated sand and water ingress for shutting down of one well after the other, leading to a drop in production. Reliance held 60 per cent interest in block KG-DWN-98/3 or KG-D6 in the Bay of Bengal. BP had 30 per cent and Niko the remaining 10 per cent. Facing cash problems, Niko exited the blocks, leaving Reliance with 66.66 per cent stake and the balance with BP. ANZ ABM

Reliance estimates $400 million liability in KG-D6 cost recovery dispute

New Delhi, Dec 30 () Reliance Industries and UK's BP plc paid USD 36 million to get their defaulting Canadian partner Niko Resources to exit from the eastern offshore KG-D6 block.
In a statement, Niko said it has exited from the KG-DWN-98/3 block and its 10 per cent stake has been taken over by Reliance and BP.
The firm was paid USD 36 million to settle an arbitration it had initiated against Reliance and BP trying to force it out of the block over default in payment.
"An amendment to the production sharing contract for the D6 Block in India has been executed, reflecting the assignment of the 10 per cent interest previously held by the company's indirect subsidiary, Niko (NECO) Ltd to the remaining interest holders in the block, Reliance Industries Ltd and BP Exploration (Alpha) Ltd," the statement said.
Subsequent to this, Reliance's stake in KG-D6 has gone up to 66.67 per cent from the previous 60 per cent and that of BP to 33.33 per cent from 30 per cent.
"Niko NECO had entered into a settlement agreement with Reliance and BPEAL under which it agreed to withdraw from D6 PSC and settle its arbitration case filed under the rules of the London Court of International Arbitration in December 2017 in exchange for a settlement amount of USD 36 million, subject to adjustment prior to closing," it said.
The settlement agreement is subject to certain conditions precedent including the execution of the amendment to the D6 PSC, it said adding the USD 36 million will go lenders to settle a part of the debt.
Niko, which defaulted on payment of loans to its lenders, had been unsuccessful in seeking a possible buyer for its 10 per cent stake in Bay of Bengal block KG-D6 or securing financing for its share of the USD 5 billion R-Cluster, Satellite Cluster and MJ development projects in the block.
This led to the company defaulting in making payments for its share of development cost.
Reliance, being the operator of KG-D6 block, slapped a default notice on Niko soon after.
Under the terms of the joint operating agreement (JOA) between the participating interest holders in the KG-D6 production sharing contract (PSC), during the continuance of a default, the defaulting party shall not have a right to its share of revenue (which shall vest in and be the property of the non-defaulting parties who have paid to cover the amount in default).
 In addition, if the defaulting party does not cure a default within 60 days of the default notice, the non-defaulting parties have the option to require the defaulting party to withdraw from the KG-D6 PSC and JOA.
 In December 2018, Reliance and BP sent Niko a notice asking it to withdraw from KG-D6. Parallelly, they approached the sector regulator the Directorate General of Hydrocarbons (DGH) and the Oil Ministry for approval to take over Niko's share.
 To stall the takeover, Niko filed a notice of arbitration challenging the withdrawal notice.
 Niko had previously withdrawn from the eastern offshore NEC-25 block due to cash crunch. Its 10 per cent interest was assigned to Reliance and BP. Subsequent to that, Reliance now holds 66.6 per cent interest in NEC-25 and BP the remaining 33.37 per cent.
 Reliance and BP are investing USD 5 billion to bring to production three sets of new discoveries in the KG-D6 block. R-Series will be the first to start output in mid-2020 with about 5 million standard cubic metres of daily production. The peak from R-Series is expected at 12 million standard cubic metres per day (mmscmd).
 Satellite fields in the same block will go live a year later and are expected to contribute a peak output of 7 mmscmd. MJ field will start production in second half of 2022 with peak production of about 12 mmscmd.
 Reliance has so far made 19 gas discoveries in the Bay of Bengal block. Of these, Dhirubhai-1 and 3 (D1 &amp; D3) -- the largest among the lot -- were brought to production from April 2009 and MA, the only oilfield in the block was put to production in September 2008.
 The output from D1 and D3 has dwindled to just 1.7 mmsmcd after touching a peak of 54 mmscmd in 2010. MA ceased to produce last year. ANZ MKJ

Reliance, BP pay $36 mn for exit of Niko in KG-D6 block

New Delhi, May 3 () Reliance Industries and its partner BP Plc of UK have pushed back the start of production from the second wave of discoveries in their eastern offshore KG-D6 block to end June because of restrictions on movement of people and material the nationwide lockdown has imposed. At current Brent oil price of around USD 26 per barrel, the gas from R-Series field in KG-D6 block will cost about USD 2.2 per million British thermal unit -- lower than even the government mandated rate of USD 2.39 for gas from state-owned ONGC fields. SEE ALSO: <a href="https://www.businessinsider.in/business/news/reliance-industries-q4-net-drops-39-pc-at-rs-6348-cr/articleshow/75474053.cms" data-type="tilCustomLink" target="_blank">Crashing crude oil cracks Reliance Industries fourth-quarter profit by nearly 40%Crashing crude oil cracks Reliance Industries fourth-quarter profit by nearly 40%</a> In an investor presentation post its fourth-quarter earnings, Reliance said it is working on three projects in the KG-D6 block, where production from older fields stopped in February this year. "First Gas from R-Cluster field expected by June 2020 subject to lifting of lockdown," it said. Gas production from R-Cluster was to start by mid-May but the coronavirus lockdown has delayed it. Reliance said it expects to achieve a peak output of around 28 million standard cubic metres per day by FY24 when all three projects are up and running. Reliance and BP are developing three sets of discoveries in KG-D6 block -- R-Cluster, Satellites, and MJ by 2022. R-Cluster will have a peak output of 12 mmscmd while Satellites, which are supposed to begin output from mid-2021, would produce a maximum of 7 mmscmd. MJ field will start production in second half of 2022 and will have a peak output of 12 mmscmd. Reliance in November last year auctioned the first set of 5 mmscmd of gas from the newer discoveries in the KG-D6 block by asking bidders to quote a price (expressed as a percentage of the dated Brent <keyword id="45185" type="ORGANIZATION" weightage="20" keywordseo="Crude-oil">crude oil</keyword> rate), supply period and the volume of gas required. Sources said Reliance had in November set a floor or minimum quote of 8.4 per cent of dated Brent price -- which meant that bidders had to quote 8.4 per cent or a higher percentage for seeking gas supplies. Considering current average Brent price of USD 26 per barrel, the gas will cost around USD 2.2 per mmBtu. Dated Brent means the average of published Brent prices for three calendar months immediately preceding the relevant contract month in which gas supplies are made. In the first round of auction in November 2019, Essar Steel, Adani Group and state-owned GAIL bought a majority of volumes on offer. The price at that time came to USD 5.1-5.16 per unit. But international oil rates have slumped as demand evaporated due to outbreak of coronavirus and lockdowns imposed by countries around the globe. Essar Steel had picked up 2.25 mmscmd in the country's first transparent and dynamic forward auction that lasted about five-and-half-hours on November 15, 2019, sources said. Gujarat State Petroleum Corp (GSPC) picked up 1.2 mmscmd while Adani Group and Mahanagar Gas Ltd bought 0.3 mmscmd, sources said, adding GAIL, acting on behalf of fertiliser companies, bought 0.3 mmscmd of gas. Hindustan Petroleum Corp Ltd (HPCL) had bought 0.35 mmscmd and 0.10 mmscmd went to Gujarat State Fertilizers &amp; Chemicals Ltd (GSFC)/Gujarat Narmada Valley Fertilizers &amp; Chemicals Ltd (GNFC), sources said. In all, 15 customers across sectors such as steel, petrochemicals, city gas, glass and ceramic got gas in the tender, they added. In the November 15 auction, bidders quoted between 8.5 and 8.6 per cent slope to corner all of the 5 mmscmd supplies available. This translated into a price between USD 5.1 per mmBtu and USD 5.16 per mmBtu at the then prevailing Brent oil price of USD 60 per barrel. Initially, Reliance had set a floor quote of 9 per cent of dated Brent price, which translated into a gas price of USD 5.4 per mmBtu at USD 60 oil price. But consumers saw this as a very high price considering that imported LNG in the spot market is available at around USD 4 per mmBtu rate currently. To pacify the consumers, Reliance lowered the floor/minimum quote to 8.4 per cent of dated Brent price. Reliance has so far made 19 gas discoveries in the KG-D6 block. Of these, D-1 and D-3 -- the largest among the lot -- were brought into production from April 2009 and MA, the only oilfield in the block was put to production in September 2008. While the MA field stopped producing last year, the output from D-1 and D-3 ceased in February. Other discoveries have either been surrendered or taken away by the government for not meeting timelines for beginning production. Reliance is the operator of the block with 66.6 per cent interest while BP holds the remaining stake. SEE ALSO: <a href="https://www.businessinsider.in/business/corporates/news/reliance-jio-profit-jumps-73-due-to-tariff-hikes/articleshow/75475445.cms" data-type="tilCustomLink" target="_blank">40% tariff hike boosts Reliance Jio’s profit by 73% in just three months ⁠— and there’s a lot more coming from the Mukesh Ambani stable</a> <a href="https://www.businessinsider.in/business/corporates/news/ril-rights-issue-ratio-pricing-and-value/articleshow/75474592.cms" data-type="tilCustomLink" target="_blank">Mukesh Ambani offers Reliance Industries shareholders 1 new share for every 15 held⁠— at a price 14% below market value</a>

RIL and BP cite COVID-19 lockdown for pushing back production from KG-D6⁠— the real reason may the price

<keyword id="448816" type="UNKNOWN" weightage="80" keywordseo="Oil-And-Natural-Gas-Corporation-Ltd-">Oil and Natural Gas Corporation Ltd.</keyword> (<keyword id="6354737" type="CITY" weightage="80" keywordseo="ONGC">ONGC</keyword>), a Public Sector Undertaking (PSU) of the Government of India, is gearing up to substantially enhance its crude oil and gas output through the development of multiple fields, said top officials.
 Though the state-run oil and gas explorer has already received approval for the development of Daman project and the re-development Bombay High North project with an investment of Rs 5,219 crore and Rs 5,707 crore, respectively. The oil corporation is at an initial stage to finalise the field development plan of KG-DWN-98/2 block, better known as <keyword id="2509216" type="UNKNOWN" weightage="80" keywordseo="KG-D5-fields">KG-D5 fields</keyword> off the east coast of India. These fields promise substantial reserves of gas and crude oil. 

	According to DK Sarraf, chairman and managing director ONGC: “We are quite bullish on that (the 98/2 block). The block should produce in mid-2018. In fact, the whole of the executive committee of ONGC went to Kakinada and reviewed the project. Many actions have been taken. It is a very challenging project. By 2021, we will get gas of 20 mmscmd.”
 

	Apart from gas reserves, the field is estimated to get 70,000-90,000 barrels of oil per day, he said.
 

	The operations will spread over 500 sq km in the KG basin. A project management team has been set up. ONGC is yet to quantify the size of investment in this field as the Field Development Plan (FDP) is still under preparation. FDP is likely to be ready by the end of the calendar year.
 

	“It (the project) is still on the drawing board stage. It is yet to get the board approval, yet to get government approval, yet to get the Directorate-General of Hydrocarbons (DGH) approval. But, technically, there is a proof concept that it can produce so much, it can produce that fast, but all the requisite approvals are yet to be obtained,” said Sarraf.
 

	“Daman field is expected to produce gas by 2018. Daman and Mumbai High North should add 7 million tonnes over a period of up to 2030. Currently, Bombay High is producing 10 million tonnes a year. We will have continuous Inhibition of Return (IOR) projects to manage the decline in production at this project,” T K Sengupta, director, offshore, ONGC, said.
 

	In the last four months, the company’s board had approved two mega projects which will add to ONGC’s output. 
	 
	The Daman project is expected to kick-start production by mid-2016. This would enhance production of natural gas and condensate in the Tapti Daman Block in Arabian Sea. The cumulative production till 2034-35 is pegged at 27.67 billion cubic meters of gas and 5.01 million cubic meters (MMm3) of condensate.
 The execution of the Mumbai High (North) project will ultimately lead to incremental gain of 6.997 million tonne crude oil and 5.253 billion cubic metres gas by 2030. As per internal reports, ONGC is also coming with <keyword id="2509217" type="UNKNOWN" weightage="80" keywordseo="Bombay-South-Development-plan">Bombay South Development plan</keyword>. 
	(Image: ONGC)

ONGC Goes Bullish On Production To Enhance Crude Oil And Gas Output

State-owned Oil and <keyword id="123483" type="COMPANY" weightage="20" keywordseo="Natural-Gas-Corp">Natural Gas Corp</keyword> (<keyword id="6354737" type="DOMAIN" weightage="20" keywordseo="ONGC">ONGC</keyword>) will lose about ₹4,000 crore in revenue and start making cash losses after the government slashed the natural gas prices by a steep 26 per cent by benchmarking it against rates prevalent in gas-surplus nations. Prices of natural gas, which is used to produce fertilizer, generate electricity and gets converted into CNG for use in automobiles and piped natural gas for household cooking, was from April 1 cut to USD 2.39 per million <keyword id="709299" type="PERSON" weightage="20" keywordseo="British-thermal-unit">British thermal unit</keyword> - a rate about 37% lower than the cost of production. "These rates are unsustainable for us. We have already told the government that the gas pricing should be freed. There should be complete pricing and marketing freedom," ONGC Chairman and Managing Director <keyword id="2579152" type="PERSON" weightage="20" keywordseo="Shashi-Shanker">Shashi Shanker</keyword> told here. The BJP-led government had in October 2014 evolved a new pricing formula using rates prevalent in gas surplus nations like the US, Canada, and Russia to determine the price in a net importing country. Prices using this formula are calculated semi-annually. Oil Minister Dharmendra Pradhan, in a written reply to a question in the Lok Sabha on March 20, 2017, had stated that the cost of production of natural gas in the prolific Krishna Godavari basin is between USD 4.99 -7.30 per mmBtu. The same for other basins is in the range of USD 3.80 -6.59 per mmBtu, he had said. For ONGC, which produces most of its 64 million standard cubic meters per day of gas from western offshore, the breakeven is around USD 3.8. "The rates are now way below cost," Shanker said. For every USD 1 dollar change, the company's revenues are impacted by Rs 4,400-4,500 crore annually. On April 1, the gas price was reduced from USD 3.23 per mmBtu to USD 2.39 - an 84 cent reduction which translates into annual Rs 4,000 crore of revenue loss. Another company official explained that gas makes up for roughly half of the company's bottomline and if the business makes losses, the company may soon start generating cash losses. The reduction on April 1 was the second in six months and took rates to the lowest since the new pricing formula came into being in 2014. The price of gas produced from difficult fields such as deepsea too has been cut to USD 5.61 from USD 8.43 per mmBtu. This would just about breakeven ONGC's new production from KG Basin. The government had in October 2014 adopted a formula that takes into account the volume-weighted annual average of the prices prevailing in Henry Hub (US), National Balancing Point (UK), Alberta (Canada) and Russia with a lag of one-quarter. Prices are set every six months -- on April 1 and October 1 each year. This formula was adopted soon after the expiry of the USD 4.2 per mmBtu rate fixed for Reliance's KG-D6 gas for five years. The rates at the first revision, using the new formula, came to USD 5.05 but in the subsequent six-monthly reviews kept falling till they touched USD 2.48 for April 2017 to September 2017 period. Subsequently, they rose to USD 3.69 in April 2019 to September 2019 before being cut by 12.5 per cent in October 2019 to USD 3.23. Sources said the government realised that the pricing arrived at using the formula was way too low to make the production of gas from difficult fields such as deepsea viable. So the government in April 2016, gave a ceiling for the gas from such fields. The ceiling in April 2016 was USD 6.61 which rose to USD 9.32 in April 2019 before being cut to USD 8.43 in October and now to USD 5.61. But this applies only for future gas production and existing deepsea finds get the lower USD 2.39 price. ONGC is India's largest integrated oil and gas company, accounting for 75 per cent of crude oil and natural gas production by volume, and 17 per cent of domestic refining capacity.

ONGC to lose ₹4,000 crore with the new gas price and bats for 'free gas prices'

New Delhi, Mar 17 () State-owned Oil and Natural Gas Corp (ONGC) has begun gas production from its most promising block in the Krishna Godavari basin in the Bay of Bengal and is planning a ramp up production in coming weeks, officials said.ONGC's KG-DWN-98/2 or KG-D5 block, which sits next to Reliance Industries' flagging KG-D6 area, holds key to the company's output profile that is constrained by aging fields.Officials said the company began production from the first well on the KG-D5 block and is currently producing around 0.25 million standard cubic meters per day.It is doing a build-up mapping and the production is likely to rise to 0.75 mmscmd within next few weeks.ONGC is investing USD 5.07 billion in developing the oil and gas discoveries in the block.The project will cumulatively produce around 25 million tonne of oil and 45 billion cubic meters of gas with peak production of 78,000 barrels per day of oil and 15 million standard cubic meters per day.After successfully commissioning its first deepwater project S1 Vasishta in eastern offshore in March 2018 (which would be yielding about 4.3 mmscmd of gas), ONGC is now concentrating on the flagship project from NELP block KG-DWN-98/2 in the deepwater of eastern offshore.Thirty-four wells are to be drilled under this project. Of these 34 wells, 15 are oil-producing, 8 are gas producing and 11 are water injecting wells.The discoveries in the block are divided into three clusters- Cluster-1, 2 and 3. Cluster 2 is being put to production first.The Cluster 2 field is divided into two blocks namely 2A and 2B, which are expected to produce 23.52 million metric tonnes of oil and 50.70 billion cubic meters (bcm) of gas.Oil production is likely to start shortly, they said.Associated natural gas from Cluster 2A of this project will have a peak production of 3 mmscmd of gas and 78,000 bopd of oil with a 15-year profile; non-associated natural gas from Cluster 2B will have a peak free gas production of 12.25 mmscmd with a 16-year profile. Officials said the KG-DWN-98/2 involves some of the most advanced oil field technologies in drilling and completion of 34 sub-sea wells, laying about 425 km of pipeline and 150 km of control umbilical in water depths varying from 300 to 1,400 metres. An Offshore Process Platform for processing and evacuating 6.5 mmscmd of gas has been built. Balance 5.75 mmscmd gas will be transported through ONGC's existing sub-sea infrastructure and facilities, created at onshore terminal of Odalarevu at the Andhra coast. Floating Production, Storage and Offloading Vessel (FPSO) will also be deployed in water depth of 413 meters to process the oil and gas. The KG-DWN 98/2 block is situated offshore the Godavari River delta in the Bay of Bengal. It is located 35-km off the coast of Andhra Pradesh in water depths ranging from 300-3,200 metres. The Cluster 2A is estimated to contain reserves of 94.26 million tonnes of crude oil and 21.75 bcm of associated gas, while Cluster 2B is estimated to host 51.98 bcm of gas reserves. The Cluster 2A is anticipated to produce 77,305 barrels of oil per day (bopd) and associated gas at a rate of 3.81 million metric standard cubic meters per day (mmscmd). The Cluster-2B is expected to produce free gas of 12.75 mmscmd from eight wells and has a 16-year life. ANZ ANZ ANUANU

ONGC starts pumping gas from KG block

The final report on the gas dispute between the state-owned ONGC and Reliance Industries was submitted, stating that natural gas worth more than Rs 11,000 crore migrated from idling ONGC’s KG fields to adjacent KG-D6 block. 
 
US-based consultant DeGolyer and MacNaughton (D&amp;M) submitted its final report to the Directorate General of Hydrocarbons (DGH), a senior government official said here. 
 
"The report more-or-less reiterates what D&amp;M had stated in the draft report that some gas had indeed migrated from ONGC's Krishna Godavari basin blocks to RIL's KG-D6 fields", he said. 
 
Now, the report will be examined to conclude that on how and to what extend should ONGC be compensated for its gas being produced by RIL. 
 
"The Supreme Court had in its order (on ONGC petition on its gas being produced by RIL) stated that government will have to in six months from the date of receipt of D&amp;M report decide on addressing ONGC contention. That we will do,” the government official said. 
 
D&amp;M, in its report, established that reservoirs in ONGC's Krishna Godavari basin KG-DWN-98/2 (KG-D5) and the Godavari Producing Mining Lease (PML) are connected with Dhirubhai-1 and 3 (D1 &amp; D3) field located in the KG-DWN-98/3 (KG-D6) Block of RIL. 
 
It states that as much as 11.122 billion cubic meters of ONGC gas has migrated from Godavari-PML and KG-DWN-98/2 to KG-D6. 
 
Of the 58.68 bcm of gas produced from KG-D6 block since April 1, 2009, 49.69 bcm belongs to RIL and 8.981 bcm could have come from ONGC's side, D&amp;M said. 
 
At gas price of $4.2 per million British thermal unit, the volume of gas belonging to ONGC which RIL has produced comes to $1.7 billion (Rs 11,055 crore). 
 
ONGC had in 2013 claimed that RIL had deliberately drilled wells close to the common boundary of the blocks and that some gas it pumped out was from its adjoining block. 
 
RIL, on the other hand, has maintained that it has "scrupulously followed every aspect of the production sharing contract and has confined its petroleum operations within the (boundaries of its) KG-D6 block" in Krishna Godavari basin. 
 
D&amp;M estimated that ONGC's Godavari-PML had 14.209 bcm of gross in-place reserves and KG-D5 another 11.856 bcm. RIL's D&amp;D3 fields held 80.697 bcm gross in-place reserves. 
 
Of these, 12.80 bcm of Godavari-PML, 8.01 bcm of KG-D5 and 75.33 bcm of KG-D6 are connected, it said. 
 
It estimated that 11.89 bcm of gas from ONGC blocks would have migrated to KG-D6 by January 1, 2017. This volume would rise to 12.713 bcm by May 1, 2019. 
 
The volume of gas remaining after this would not be economically viable for ONGC to develop. 
 
D&amp;M was jointly appointed by ONGC and RIL to find if the neighbouring fields are connected.

You Searched For "kgd6 gas" and got 13 results

Reliance Industries wins govt nod for additional investment to raise KG-D6 gas output

PTI

RIL and BP expect to sell gas from KG-D6 deep water blocks starting February

IANS

Reliance-BP to auction more gas from KG-D6 block this month

PTI

D1/D3 gas field in Reliance's KG-D6 block shuts down

PTI

Reliance pushes back KG-D6 production to Sep/Oct

PTI

Reliance and BP start production from KG-D6 oil field – off the coast of Kakinada

Sanchita Dash

Reliance estimates $400 million liability in KG-D6 cost recovery dispute

PTI

Reliance, BP pay $36 mn for exit of Niko in KG-D6 block

PTI

RIL and BP cite COVID-19 lockdown for pushing back production from KG-D6⁠— the real reason may the price

PTI

ONGC Goes Bullish On Production To Enhance Crude Oil And Gas Output

BI India Bureau

ONGC to lose ₹4,000 crore with the new gas price and bats for 'free gas prices'

PTI

ONGC starts pumping gas from KG block

PTI

Mukesh Ambani might soon find himself paying a hefty compensation to ONGC

BI India Bureau

Popular Keywords

Buying Guides