It is expected that the new gas discovery by Reliance Industries Limited,MJ-1 in KG-D6 block, may prove vital for its business. The discovery may have gas resources equaling to 1.4 Trillion Cubic Feet (Tcf). This is around half the quantity that may be acquired from the main gas fields of the block.
The minority partner of Reliance Industries, Canada's Niko Resources informed that MJ-1 may hold contingent resource of 0.988 Tcf of gas of condensate (low estimate) and 2 Tcf (high estimate). The discovery is situated at a depth of 2,000 meters under the producing D1-D3 field in the eastern offshore KG-D6 block.
Statements of the report
Niko Resources took an evaluation report from Deloitte LLP, regarding the MJ Discovery in the D6 Block. The report stated that the discovery may hold 1.4 Tcf of gas and condensate.
The 6-year old, main Dhirubhai-1 and 3 gas fields holds 3.10 Tcf of downgraded reserves. The R-series have recoverable reserves of around 2 Tcf. If the report estimates turn to be correct then MJ-1 will rank third in terms of biggest gas fields in KG-D6 after D1&D3 and R-Series.
"Deloitte's best case estimate of gross un-risked contingent resources of 1.4 trillion cubic feet of equivalent relates to the Central (North), Northern and Central (South) fault blocks that were drilled by the MJ-1, MJ-A1, and MJ-A3 wells, based on an estimated areal extent of approximately 24 sq. kms. approximately twice the areal extent of the analogous MA field that is currently producing," the report said.
Niko Resources also informed that Contingent Resources are similar to the quantities of petroleum recoverable from known resources. It may be recovered from using expertized technology or technology that is still being developed. However, these are not regarded to be recoverable in commercial terms because of one or more possibilities.
Understanding the possibilities, the report stated that the cost that may incur to produce and operate are not fixed and hence the economic volumes have not been set up. To get the field on-stream, an approval from the Indian government will be required. Reliance Industries is presently working on appraisal and building development plans.
Reliance's share in the resources
Reliance Industries operates the Krishna Godavari basin KG-D6 block and holds 60% interest. 10% interest is held by Niko Resources and the remaining 30% is acquired by United Kingdom's BP plc. Reliance Industries has made 19 gas discoveries till date. D1&D3 were made to produce from April, 2009 and the production in MA oil and gas field began in September, 2008.
About Reliance Industries
Reliance Industries was founded by Late Dhirubhai Ambani. The company has nowbecome the biggest private sector company in India. It is also named in the Fortune Global 500 list. After textiles, the company has carved its name in the sectors of polyester, plastics, fiber intermediates, petroleum refining, oil and gas, etc. It ranks first in the world in the production of polyester yarn and fiber and also features among the top 10 companies in the production of major petrochemical products.