Mukesh Ambani led Reliance Industries leases storage in the Carribean

Reliance Industries, owner of the world's largest oil refining complex, has leased storage to store gasoline at the Borco oil terminal in the Caribbean, industry sources said on Thursday.

The deal on the 500,000 barrels storage facility was secured sometime towards the end of last year, traders said. "We know they have their eyes on the domestic US market, that is no secret, but it is going to be a while before we see demand there pick-up to pre (financial) crisis levels," a Singapore based trader said. "So now Reliance is also looking at other long markets further South," a Singapore based gasoline trader said.

Reliance, which operates two mega-refineries in the West Coast of India that has a combined crude processing capacity of 1.24 million barrels per day (bpd), has over the past few years embarked on a robust marketing campaign for their products in Europe, Latin Ameica, East Africa and the United States.

Source: http://economictimes.indiatimes.com/news/news-by-industry/energy/oil-gas/Reliance-leases-storage-in-the-Caribbean/articleshow/5509090.cms

Reliance leases storage in the Carribean

Reliance Industries, owner of the world's largest oil refining complex, has leased storage to store gasoline at the Borco oil terminal in the Caribbean, industry sources said on Thursday.

The deal on the 500,000 barrels storage facility was secured sometime towards the end of last year, traders said. "We know they have their eyes on the domestic US market, that is no secret, but it is going to be a while before we see demand there pick-up to pre (financial) crisis levels," a Singapore based trader said. "So now Reliance is also looking at other long markets further South," a Singapore based gasoline trader said.

Reliance, which operates two mega-refineries in the West Coast of India that has a combined crude processing capacity of 1.24 million barrels per day (bpd), has over the past few years embarked on a robust marketing campaign for their products in Europe, Latin Ameica, East Africa and the United States.

Source:http://economictimes.indiatimes.com/news/news-by-industry/energy/oil-gas/Reliance-leases-storage-in-the-Caribbean/articleshow/5509090.cms

Reliance Increases Fuel Sales in India to Meet Rising Demand

Reliance Industries Ltd., operator of the world’s largest refining complex, increased its share of sales in India to meet growing demand for fuels.

The Mumbai-based energy explorer and refiner sold 20.65 million metric tons of fuels in the South Asian nation in the nine months ended Dec. 31 compared with 8.01 million tons a year earlier, according to Bloomberg calculations based on export figures released by the company today. The numbers were confirmed by a Reliance spokesman, who declined to be identified in line with company policy.

Reliance, which can process 1.24 million barrels of oil a day, increased its share of fuel sales in India as the global recession cut demand for gasoline and diesel in the U.S. and Europe. The company gave up the export-only status of its first refinery in April after completing in December 2008 a 580,000 barrel-a-day refinery that caters to overseas customers.

Domestic sales as a share of output rose to 47 percent in the nine months ended Dec. 31, compared with 33 percent a year earlier, according to data released by the company. Customers include Indian Oil Corp., the largest state-run refiner, which started purchasing diesel and gasoline from Reliance in April.

“Buying fuels from Reliance reduces our costs,” Gyan Chand Daga, marketing director at Indian Oil, said by telephone from Mumbai today. “Demand for fuels is growing and we need to meet that gap.”

India’s oil product sales grew 3.2 percent in November from a year earlier, compared with a 2.7 percent contraction in demand in major industrialized economies, the International Energy Agency said in its latest monthly report.

Retail Outlets

Reliance has reopened more than 600 retail fuel outlets in India, according to today’s statement. The company mothballed its 1,433 gas stations nationwide as crude soared to a record in 2008, unable to compete with state-owned refiners that sold motor fuels below cost.

The revenue loss for state refiners on sales of motor fuels declined after crude fell from a record in July 2008. Indian Oil said in August it lost 2.30 rupees on every liter of diesel sold compared with a shortfall of 13 rupees a liter in September 2008.

The government partly compensates state refiners for selling fuels below cost without extending the benefit to private refiners, including Reliance and Essar Oil Ltd.

Source:http://www.bloomberg.com/apps/news?pid=20601091&sid=auw0zfU5yliU

Reliance becomes first Indian company to produce Euro IV compliant diesel

Unlike 2005, when the country’s private refiners were late in producing Euro-III compliant fuel, this time the private sector has taken a lead, with Reliance Industries Ltd (RIL) becoming the first Indian refinery to produce Euro-IV compliant diesel.

The first cargo of 25,000 tonnes of Euro-IV grade diesel from RIL’s refinery at Jamnagar was shipped by Hindustan Petroleum Corporation Ltd (HPCL) on Friday, said an informed source. This is also the first coastal supply of Euro-IV diesel for the Indian market.

Sources said RIL was also gearing up to produce the higher grade of petrol. With the private refiner now ready to produce the higher grade, it will be easier for oil marketing companies to ensure the availability of Euro-IV diesel at the retail outlets of all 13 major cities of India by April 1, the target date.

An RIL spokesperson confirmed the sale of diesel. He did not give details on total production, citing trade confidentiality reasons.

Indian Oil Corporation, the biggest oil marketer, and Bharat Petroleum Corporation Ltd have recently floated tenders to import 120,000 tonnes and 60,000 tonnes of Euro-IV diesel, respectively.

Government policy calls for petrol and diesel meeting Euro-IV standards are to be supplied in 13 cities, including Delhi, Mumbai, Chennai, Kolkata, Bangalore, Hyderabad and Ahmadabad, from April 1. Euro-III grade fuel is to be supplied across the rest of the country from the same day. The former deadline will be met. Sales of Euro-III will begin in a phased manner between April 1 and October 1.

Source:http://www.business-standard.com/india/news/ril-refinery-first-to-produce-euro-iv-auto-fuel/383580/

Reliance Solar Group Middle East and Africa Exclusive Distributors is PTL Solar

Dr. Farooq Abdullah, Minister for New and Renewable Energy, Government of India, inaugurated the first exclusive international Reliance Showroom at the Dubai Creek Towers in Deira. Rabindra Satpathy, President of Reliance Solar Group was also at inauguration ceremony and informed that PTL solar is appointed as exclusive distributors for the Middle East and Africa region for Reliance Solar Group which is a part of Reliance Industries Ltd.

PTL Solar, experts in solar street lighting solutions and part of Green Energy, has become the exclusive distributor in the Middle East and Africa for Reliance Solar Group, part of Reliance Industries, one of India’s largest private sector enterprises. PTL Solar is highly commended and appreciated at the Power Generation and Water Solutions Middle East Awards 2009 for ”ENERGY EFFICIENCY” AND “POWER GENERATION AND WATER SOLUTIONS INNOVATION OF THE YEAR AWARD 2009“:. The company is also expert in solar street lighting solutions and part of Green Energy LLC.
Business partners, suppliers, and customers of PTL Solar, as well as a few members of a delegation from the Confederation of Indian Industry (CII) also attended the event. Prabissh Thomas, Managing Director of PTL Solar, briefed guests about the offerings of the showroom and the details of the distributorship agreement with Reliance Solar Group.

Reliance Solar Group specialises in solutions ranging from solar lanterns, home lighting and street lighting to water purification, refrigeration and solar air conditioners — all based on solar energy.

As part of its campaign to transform the existing lighting system into solar-based applications, PTL Solar has supplied its solar energy outdoor lighting units GRENlite to Dubai Electricity and Water Authority (DEWA) as well as Tecom Investments’ Dubai Outsource Zone and Dubai Internet City.

In addition, the company has installed solar car park lights for Nakheel in the Waterfront project, as well as illuminated the first automotive factory in the UAE for heavy vehicles assembled by Scania.

India’s crude output to rise as Reliance’s KG D6 expects an increase in production

Reliance Group and Cairn India will help increase nation's crude oil output by 11 per cent and natural gas production by 53 per cent in 2009-10, oil regulator Directorate General Hydrocarbons (DGH) said today.

Speaking at an Assocham conference, DGH Director General S K Srivastava said the country's gas production would double next year when RIL's KG-D6 fields' reach peak output.

KG-D6 field is expected to reach peak output of 80 million standard cubic meters per day by mid-2010.
Srivastava, according to an Assocham statement, said oil production from Cairn's Barmer basin field in Rajasthan is expected to contribute about 18 per cent of the country’s total oil production in near future.

India's crude oil production has been stagnant around 32 million tons for past few years and output from Barmer and KG-D6 fields would raise nation's oil production.

"...After stagnant production for over a decade, in 2009 -10 crude oil production is likely to increase by 11 per cent and natural gas by 53 per cent over previous year," he said.

Cairn's Rajasthan field is currently producing about 20,000 barrels per day while Reliance Industries is pumping out 10,000 bpd from KG-D6.

On the new discoveries, he said increased exploration would result in new discoveries by 2015-16 which would require investment to an extent of USD 25 billion.

He also said that besides conventional oil and gas, the government is actively pursuing other fossil fuel alternatives such as gas hydrates, coal bed methane (CBM) and oil shale.

"The DGH is in the select League of Nations pursuing hard to commercialise gas production from gas Hydrates. Oil share resources are currently under evaluation," Srivastava added.

He, however, regretted that in 8th round of NELP, the Petroleum Ministry could award only 36 oil and gas blocks out of identified 70 blocks due to adversaries of global turmoil.

"Unfortunately, the Ministry will not be able to offer the unbid 34 blocks to prospective investors in the current fiscal as it requires several inter-governmental approvals which take a good deal of time," Srivastava said.

He remained non-committal by what time the unbid blocks will be awarded for oil & gas production.

Speaking on the occasion, D M Kale, Director General, ONGC Energy Centre said that his Corporation is spending Rs 10,000 crore annually to arrest 2 per cent decline in crude oil production.

Source:http://oilandgasindia.blogspot.com/2010/01/crude-oil-production-to-go-up-11pc.html

Reliance to drill six new wells in KG

Reliance Group intends to drill six additional exploration/appraisal wells in the KG-D6 block in 2010. It has proposed to invest $1.5 billion (approx Rs 6,975 crore) more in the proposed block in developing satellite gas finds.
"Six additional exploration/appraisal wells will be drilled this year," said Niko Resources, the
junior partner in RIL-operated KG-D6 block.


Reliance Industries has till date made 19 discoveries-- 18 gas and one oil--in deep-sea block KG-DWN-98/3 or KG-D6. Of these, it developed Dhirubhai-1 and 3 gas fields in the first phase at an investment of USD 8.836 billion.

It has now proposed to invest another USD 1.5 billion in bringing to production four satellite finds in the block.

Dhirubhai-1 and 3 fields, which began gas production in April last year, hold 10.03 Tcf of reserves and are currently producing about 60 million standard cubic meters per day. The peak output of 80 mmscmd likely this year, would double gas availability in the country.

The Mumbai-based firm had in July 2008 proposed to develop 9 discoveries adjoining these two giants at a cost of USD 5.91 billion. But after more techno-commercial viability studies, it decided to narrow down to four finds that can be put to production in next 4-5 years.

Reliance has already submitted a field development plan to the Directorate General of Hydrocarbons for the four discoveries that it estimates hold 0.6 tcf of recoverable reserves.
RIL holds 90 per cent interest in the block and the remaining 10 per cent is with its other partner Niko Resources.
Source:http://www.thehindubusinessline.com/blnus/02061932.htm

Reliance to invest $1.5 bn more in KG-D6

RIL has proposed to invest an additional $1.5 billion in bringing to production four gas discoveries adjoining its prolific gas fields in Krishna-Godavari basin in the country's east coast.

Reliance Group had in July 2008 proposed to develop nine satellite discoveries in the Krishna Godavari basin block at a cost of $5.91 billion, but later narrowed it down to four finds that can be put to production in the next 4-5 years.

The company last week submitted a field development plan (FDP) to the Directorate General of Hydrocarbons (DGH) for the four discoveries that it estimates hold 0.6 trillion cubic feet of recoverable reserves, government sources said.

The sources said, plans to produce 10 million standard cubic meters per day of gas from the four fields for 6 years.

Reliance has till date made 19 discoveries in deep-sea block KG-DWN-98/3 or KG-D6 -- 18 gas and one oil. Of these, it developed Dhirubhai-1 and 3 fields in the first phase. The two fields, which began gas production in April last year, hold 10.03 Tcf of reserves.

Reliance Industries has so far invested $5.8 billion out of the estimated $8.836 billion cost of developing D1 and D3 fields over their entire life. The fields are currently producing around 60 mmscmd of gas and envisage a peak output of 80 mmscmd in 2010.

Reliance Industries has invested $2.234 billion in developing the MA oil field in the block that is currently producing about 10,000 barrels of crude oil per day.

Source:http://www.business-standard.com/india/news/reliance-proposes-15-bn-more-investment-in-kg-d6/82191/on

Reliance’s third successive gas discovery in KG Basin

Reliance Group of Industries (RIL), the country’s largest private sector company, has announced its third successive gas discovery in the exploration block KG-DWN-2003/1 (KG-V-D3), of NELP-V. The deepwater block KG-DWN-2003/1 is located in the Krishna basin, about 45 kilometers off the coast in the Bay of Bengal. The block covers an area of 3288 square kilometres. RIL holds a 90 per cent participating interest (PI) and Hardy Exploration and Production India Inc holds the rest.

The well KGV-D3-R1, the third in this block was drilled at a water depth of 1982 m and to a total measured depth of 4113 m. The objective was to explore the Miocene deep water lobe and onlapping wedges play fairway. Three reservoir zones were encountered at Miocene Level having gross thickness of 4, 23 and 16 metres. The potential of these were evaluated through a wire-line based technology called Reservoir Characterization Imager (RCI).

The discovery namely “Dhirubhai - 44” has been notified to the government of India and the Directorate General of Hydrocarbons. The potential commerciality of the discovery is being ascertained through more data gathering and analysis.

The discovery supplements RIL’s understanding, of the petroleum systems within the block. 3D seismic has been acquired over the entire block area. Besides the above discoveries, several prospects have been mapped at different stratigraphic levels to fulfill the balance minimum work commitment of three wells.

Reliance is likely to drill three additional exploration wells on the block before the end of 2010. In August 2005, Reliance and HEPI were awarded D3 block under NELP-V. Reliance is the operator of the block.
Exploration drilling commenced on this block in 2008.

Source:http://ril.com/downloads/pdf/PR22122009.pdf

Ambani Gas Row – Government has every right to regulate gas price: RIL

RIL counsel Harish Salve made this assertion before the three-member bench of Chief Justice K.G. Balakrishnan, in his counter-arguments in the legal battle with Reliance Natural Resources Ltd (RNRL) over gas supplies from the Krishna-Godavari basin.

"If I challenge the gas utilization policy and the court says 'sorry, you do not have the power', the government will discover the power elsewhere," Salve told the bench, which includes Justice B. Sudershan Reddy and Justice P. Sathasivam.

"The government is opening various sectors to private players. If we do not behave responsibly, we may earn profit for 15 days, but will eventually be out of business."

"The only suitable agreement for supply of gas to the REL's Dadri power plant is supply of gas under the gas utilization policy and at the price arrived at as per the formula approved by the empowered group of ministers," he said.

This decision by the ministerial group is applicable to all the gas produced by RIL, Salve said, adding this compelled his client to supply gas to specific customers, in defined quantities and at the notified price.

The government has also specified that a firm commitment on gas supplies can be made only for five years, based on the ministerial panel's recommendations, he said.

Source:http://economictimes.indiatimes.com/news/news-by-industry/energy/oil-gas/Government-has-every-right-to-regulate-gas-price-RIL/articleshow/5348440.cms

Reliance pumping out over 50 mmscmd gas from KG Basin: Government

Reliance Industries (RIL) is currently producing over 50 million standard cubic meters per day (mmscmd) of natural gas from the KG Basin D-6 fields, the government said.

"The current gas production from the D-1 and D-3 gas fields is about 48 mmscmd and from MA (oil) field is about 2.3 mmscmd in the KG-D-6 Block," Minister of State for Petroleum and Natural Gas Jitin Prasada told the Lok Sabha in a written reply.

The gas produced from the KG-D6 Block is being allocated and sold as per the directives of the Empowered Group of Ministers, he said, adding the peak gas production of about 80 mmscmd from the field is likely to be achieved by the middle of next year.

"The government has not, till date, fixed or approved the quantum of marketing margins for sale of natural gas by any contractor," he said, adding "the issue is discussed and decided between the seller and the buyer, as a part of the settlement of the terms and conditions of the gas sales and purchase agreement (GSPA)."

Source:http://www.business-standard.com/india/news/ril-pumping-out-over-50-mmscmd-gaskg-basin-govt/80500/on

Reliance Gas from KG adding value to India’s GDP

The recent CSO estimate of India’s GDP for the second quarter of 2009-10 came like a whiff of fresh air amidst the gloomy scenario that was painted last week by the Dubai debt crisis. GDP growth has received its surprising but much-needed impetus from a booming mining and quarrying sector, which grew by 9.5% in the second quarter of 2009-10 as compared to 3.7% recorded during the second quarter in 2008-09. This has largely been attributed to a bolstering growth in output from Reliance Group’ Krishna Godavari (KG) basin, whose gas output alone is expected to shore up India’s GDP by nearly 0.3% every year.

India’s natural gas output from domestic fields has now reportedly exceeded the threshold figure of 100 million cubic metres per day (mmcmd) of output as KG D6 has started operating in full swing. The upstream natural gas sector in India is a classic example of duopoly and comprises two major players, namely RIL and ONGC. Despite holding a couple of big road shows within and outside the country, the much-hyped latest round of NELP could hardly make any perceptible difference in terms of increasing the number of players in the upstream sector. Interestingly,RIL’s latest reported output of 50.15 mmcmd from KG-D6 fields in the KG basin surpassed 49.6 mmcmd of natural gas output reported by ONGC, thus making Reliance Industries effectively the largest player in the natural gas upstream sector. The lion’s share of ONGC’s gas output comes from its Bassein and Mumbai High fields, which reportedly account for 42 mmcmd of natural gas output. A relatively meagre 16 mmcmd of output has been reported from Panna/Mukta and Tapti fields of BG India, which again is a joint-venture between the BG Group, RIL and ONGC. The residual amount comes primarily from the Rawa field, where stakeholders include Cairn Energy and ONGC.

RIL’s natural gas generated from KG basin in Bay of Bengal has heralded almost a new era inIndia’s energy sector with far-reaching implications for India’s ‘clean energy’ security, especially in view of the heightened concern for climate change. RIL has already developed the D-1 and D-3 fields in KG basin and is pursuing a new integrated development plan for its R-series of natural gas finds and nine other satellite discoveries in the D6 block. The combined potential for these gas finds and satellite discoveries has reportedly been estimated as lying between 2-3 trillion cubic feet. Until the middle of this year, ONGC and its western assets in the Mumbai offshore area have dominated India’s oil and gas industry. However, ONGC is now resorting to a look-east policy as the production of Mumbai has started deteriorating and it is planning to recoup its losses by developing its eastern assets (oil and gas discoveries in the KG basin off the east coast). Moreover, RIL’s D6 block development in record time has also posed a serious challenge for the public player.

Meanwhile, ONGC has also stated on its Web site that a draft proposal on revision of Administered Price Mechanism (APM) gas produced by national oil companies has reportedly been circulated by MoPNG on the basis of recommendation of Tariff Commission (TC) for consideration and approval by the Cabinet Committee on Economic Affairs. The TC essentially wants to bring parity between the APM price and the price of the gas produced from KG basin by 2013 in a phased manner. The price of natural gas, which is produced by public players like ONGC from government nominated blocks, is governed by APM and lies well below the free market price of natural gas. This leads to a substantial loss for them. The loss in the last financial year itself has been reported at Rs 47 billion. Thus, ONGC is expected to benefit considerably if the proposal gets finally approved. Under the proposal, ONGC’s APM gas price would be Rs 4,142 per thousand standard cubic metres (mscm) {$2.32 per million British thermal units (mmbtu)}, up from Rs 3,200 mscm ($1.79 mmbtu). This is indeed a welcome proposition and would provide a big push to the public sector gas producer. However, MoPNG should also get back to its agenda of complete deregulation of prices of refined petroleum products, especially auto-fuels like petrol and diesel; otherwise after revision of APM gas price, CNG might just lose out on its competitive edge as a cleaner and cheaper automobile fuel in the cities that are currently receiving it.

The development of indigenous source of cleaner and cheaper fuel like natural gas would serve the dual purpose of reducing our unhealthy dependence on imported oil and enhance our ‘clean energy’ security, besides boosting our GDP. Furthermore, the International Energy Agency also recently reckoned that there would be a continued glut in the natural gas market, which would depress the gas price in the near and medium term.

Thus, the international liquefied natural gas producers are expected to look eastwards, especially towards India and China as first ports of call. This would provide a great opportunity to India in reducing its dependence on highly priced imported oil and shift to an environmentally benign fuel, and thus, save largely on its precious foreign exchange.


Source:http://oilandgasindia.blogspot.com/2009/12/rils-kgd6-adding-contribution-to-indias.html"

Controversies have surrounded KG D6 gas, but RIL downplayed all

Reliance Industries operated KG-DWN-98/3 gas field, also known as KG D6 has run into controversies immediately after the major gas find in 2002. Whether it is the quantum of the discovery, capital expenditure for the development, legal tussle with NTPC over the contractual obligation or the Memorandum of Understanding (MOU) signed with Reliance Natural Resources (RNRL) for supplying 28 mmscmd gas, Reliance has witnessed numerous allegations.

Reliance Group, however, has proven these accusations erroneous time and again. RIL had estimated the reserves of KG D6 block to the tune of 14 trillion cubic feet (tcf), which was downplayed by many to the maximum of 5-6 tcf. Today, with limited number of wells drilled, the commercially recoverable reserves are approved at 11.3 tcf by the Government. The in-place reserves are estimated to the extent of 40 tcf by various analysts. Similarly, the capital expenditure of $8.8 billion was said to be escalated. The Government, however, itself came forward in defense of the accusation arguing that the reserve estimates along with peak production level has doubled since the initial development plan resulting in increased capital cost due to three-fold rise in commodity prices, equipment prices, rig charges and engineering cost.

As far as NTPC issue is concern, RIL has made it clear that disagreement with NTPC is not on the price of $2.34 per mmbtu but on unlimited liability clause which coerces the RIL to pay for entire cost of substitute fuel in case of gas supply failure even in case of force-majeure by the company. RIL only wants the penalty charges to be capped that too as low as half of what is applicable for NTPC in case of its inability to off-take the gas, which may force the RIL to flare a sizable amount of precious gas.

Even in case of RNRL, Reliance agrees to supply the said quantity of gas at agreed price provided the Government consents on price and marketing freedom. In fact, RIL tried to get the Government certification for price of gas to be supplied to RNRL, however, the latter rejected the same, stating that the price did not match the arms-length criteria of pricing as per the Production Sharing Contract (PSC).

Source:http://oilandgasindia.blogspot.com/2009/12/where-does-gas-price-of-42-per-mmbtu.html

Reliance ropes in Colombia’s Ecopetrol for Exploration

Indian energy major Reliance Group has signed a deal with Colombian state oil firm Ecopetrol for two deepwater blocks in Colombia.

Reliance said Exploration and Production DMCC (REP) has signed an agreement with Ecopetrol under which the Colombian firm would take a 20 per cent stake in the two deepwater blocks -- Borojo North Block 42 and the Borojo South Block 43.

The two blocks cover an area of 8,000 sq km. In water depths ranging from 60-1500 metres, the company said.

REP would hold the remaining stake in the two blocks and the deal is subject to approval of the Columbia's upstream regulator, company said.

Source:http://www.business-standard.com/india/news/ril-ecopetrol-ink-pact-for-deep-water-blocks/80002/on

Reliance Gas from KG adding value to India’s GDP

The recent CSO estimate of India’s GDP for the second quarter of 2009-10 came like a whiff of fresh air amidst the gloomy scenario that was painted last week by the Dubai debt crisis. GDP growth has received its surprising but much-needed impetus from a booming mining and quarrying sector, which grew by 9.5% in the second quarter of 2009-10 as compared to 3.7% recorded during the second quarter in 2008-09. This has largely been attributed to a bolstering growth in output from Reliance Industries’ Krishna Godavari (KG) basin, whose gas output alone is expected to shore up India’s GDP by nearly 0.3% every year.

India’s natural gas output from domestic fields has now reportedly exceeded the threshold figure of 100 million cubic metres per day (mmcmd) of output as KG D6 has started operating in full swing. The upstream natural gas sector in India is a classic example of duopoly and comprises two major players, namely RIL and ONGC. Despite holding a couple of big road shows within and outside the country, the much-hyped latest round of NELP could hardly make any perceptible difference in terms of increasing the number of players in the upstream sector. Interestingly,RIL’s latest reported output of 50.15 mmcmd from KG-D6 fields in the KG basin surpassed 49.6 mmcmd of natural gas output reported by ONGC, thus making Reliance Group effectively the largest player in the natural gas upstream sector. The lion’s share of ONGC’s gas output comes from its Bassein and Mumbai High fields, which reportedly account for 42 mmcmd of natural gas output. A relatively meagre 16 mmcmd of output has been reported from Panna/Mukta and Tapti fields of BG India, which again is a joint-venture between the BG Group, Reliance Industries and ONGC. The residual amount comes primarily from the Rawa field, where stakeholders include Cairn Energy and ONGC.

RIL’s natural gas generated from KG basin in Bay of Bengal has heralded almost a new era inIndia’s energy sector with far-reaching implications for India’s ‘clean energy’ security, especially in view of the heightened concern for climate change. RIL has already developed the D-1 and D-3 fields in KG basin and is pursuing a new integrated development plan for its R-series of natural gas finds and nine other satellite discoveries in the D6 block. The combined potential for these gas finds and satellite discoveries has reportedly been estimated as lying between 2-3 trillion cubic feet. Until the middle of this year, ONGC and its western assets in the Mumbai offshore area have dominated India’s oil and gas industry. However, ONGC is now resorting to a look-east policy as the production of Mumbai has started deteriorating and it is planning to recoup its losses by developing its eastern assets (oil and gas discoveries in the KG basin off the east coast). Moreover, RIL’s D6 block development in record time has also posed a serious challenge for the public player.

Meanwhile, ONGC has also stated on its Web site that a draft proposal on revision of Administered Price Mechanism (APM) gas produced by national oil companies has reportedly been circulated by MoPNG on the basis of recommendation of Tariff Commission (TC) for consideration and approval by the Cabinet Committee on Economic Affairs. The TC essentially wants to bring parity between the APM price and the price of the gas produced from KG basin by 2013 in a phased manner. The price of natural gas, which is produced by public players like ONGC from government nominated blocks, is governed by APM and lies well below the free market price of natural gas. This leads to a substantial loss for them. The loss in the last financial year itself has been reported at Rs 47 billion. Thus, ONGC is expected to benefit considerably if the proposal gets finally approved. Under the proposal, ONGC’s APM gas price would be Rs 4,142 per thousand standard cubic metres (mscm) {$2.32 per million British thermal units (mmbtu)}, up from Rs 3,200 mscm ($1.79 mmbtu). This is indeed a welcome proposition and would provide a big push to the public sector gas producer. However, MoPNG should also get back to its agenda of complete deregulation of prices of refined petroleum products, especially auto-fuels like petrol and diesel; otherwise after revision of APM gas price, CNG might just lose out on its competitive edge as a cleaner and cheaper automobile fuel in the cities that are currently receiving it.

The development of indigenous source of cleaner and cheaper fuel like natural gas would serve the dual purpose of reducing our unhealthy dependence on imported oil and enhance our ‘clean energy’ security, besides boosting our GDP. Furthermore, the International Energy Agency also recently reckoned that there would be a continued glut in the natural gas market, which would depress the gas price in the near and medium term.

Thus, the international liquefied natural gas producers are expected to look eastwards, especially towards India and China as first ports of call. This would provide a great opportunity to India in reducing its dependence on highly priced imported oil and shift to an environmentally benign fuel, and thus, save largely on its precious foreign exchange.

Source:http://oilandgasindia.blogspot.com/2009/12/rils-kgd6-adding-contribution-to-indias.html

Reliance beats ONGC, becomes country's largest gas producer

Reliance Industries has become the largest natural gas producer in the country with its over 50 million standard cubic meters per day (mscmd).

This is the first time it has surpassed ONGC’s 49.6 mscmd output.

Reliance Group gas production from its D6 fields in the Krishna Godavari basin has reached to 50.15 mscmd according to the regular output report Reliance sent to the oil ministry.

India’s gas output also exceeded 100 mmcmd with the contribution from KG D6. The world’s second most populous nation also draws 16 mmcmd from BG India’s Panna/Mukta and Tapti fields.

The ministry official said 22.84 mmscmd of D6 gas is sold to power companies, 15.19 mscmd to fertiliser units and 5.05 mmscmd to steel manufacturers. Refineries, including those of RIL, recently named as additional customers, are drawing about 5 mmscmd.

KG D6 is expected to increase its gas flow to 60 mmcmd by end of December and 65 mmcmd in January.
The project will reach highest peak production of 80 mmcmd in the second half of 2010.

Source:http://www.business-standard.com/india/news/ril-topples-ongc-as-largest-gas-producer/378206/

Reliance's D6 gas lights up idle capacity

With the Reliance Group operated KG-basin D6 block gas flowing in, the gas-based power generation across the country has registered a healthy turnaround. In October, a total of 15 gas-based stations recorded a plant load factor (PLF) of over 80 per cent due to improved fuel availability, as against around just 50 per cent last year.

The spurt in gas-based production has more or less compensated for a dip in hydro generation in the northern and eastern regions, where reservoir storage was 35 per cent and 33 per cent respectively below last year's levels.

Increased generation by gas stations, especially those in the south, have also come at a time when coal-based generation at a number of stations, including key NTPC ones, have faltered due to a botched-up coal tender. Domestic natural gas production in April-October period was up 31 per cent at 25.389 bcm (billion cubic metres). Reflecting the jump in gas production, generation in gas-based plants shot up 34 per cent during April-October. “Surplus is also available due to low offtake by other sectors. The utilisation of the surplus gas has resulted in better utilisation of idle capacity,” an official with the Central Electricity Authority said.

Source:http://www.thehindubusinessline.com/2009/11/30/stories/2009113051160100.htm