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OIL & GAS
 
Vol. VIII Issue. 44
RIL can raise KG-D6 output with more drilling, tech

17 April 2012

April 12, 2012. Reliance Industries (RIL) will be able to raise gas production from the D6 block with the help of additional drilling and appropriate technology but current gas prices are too low to justify more investment, a report from Bernstein Research said. Output at the D6 block has dropped sharply, creating a severe shortage of natural gas. Reliance Industries attributes the decline to geological complexities, while the Directorate General of Hydrocarbons (DGH) has accused the company of not drilling the required number of wells to produce more gas. Bernstein Research agrees with Reliance's diagnosis. Output from the field is also expected to decline further, it said. The geological complexity includes presence of sandy formations that obstruct the flow of gas within the reservoir and ingress of water and sand into the wells. This problem can be resolved, if more money is spent, it said. It said pricing reforms by the government would trigger a new wave of exploration and development in offshore regions of India, which remain vastly under-explored. Reliance itself has been able to develop only three of its offshore discoveries.

      
 
 
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