Reliance Industries Ltd - Niko Resources Ltd’s major gas discovery in the Krishna-Godavri basin (Dhirubhai 1 and 3 wells in D6 block) is expected to reach its plateau rate of 80 million metric standard cubic metres per day (MMSCMD) in July 2011 and retain the level for six years. The first gas production will commence in June 2008 at the level of 27.6 MMSCMD and touch 40 MMSCMD during next two years.
In a presentation to Energy Coordination Committee under Prime Minister Manmohan Singh, the estimated capital expenditure has been pegged at $ 8.836 billion with nearly $ 5.197 billion in the first phase. The government plans to monitor gas development programmes of Oil and natural Gas Corporation, Reliance Industries Ltd and Gujarat State Petroleum Corporation in the KG basin.
Reliance had initially proposed investment of $ 2.47 billion to produce 40 MMSCMD for 7.5 years from discoveries in the D6 block. The deepwater block KG-DWN-98/3 in Krishna-Godavari basin off the eastern coast in Bay of Bengal was awarded to RIL and Niko Resources, Calgary in the first round of New Exploration Licensing Policy (NELP-I). RIL as operator holds 90 per cent of the participating interest and Niko the remaining 10 per cent.
Based on the initial reserves estimates of the block RIL prepared an initial development plan for developing two discoveries Dhirubhai I and Dhirubhai 3 in the block. The initial plan envisaged production plateau of 40 MMSCMD. Later RIL announced plans to double its output from its prolific block in the KG basin.
The initial development plan was submitted to the Directorate General of Hydrocarbons in May 2004 and approved in November 2004. Subsequent to the approval of the plan for Dhirubhai I and Dhirubhai 3 gas fields, exploratory work has been done and independent of the reserves undertaken. In view of the detailed assessment, a new plan was submitted and approved by management committee on Dec 12, 2006.
The project is the first deepwater development project in India and on commissioning would be among the largest and most complex deepwater gas production system in the world. The project is expected to be completed in about 6 years from the first discovery.