Reliance Industries (RIL) has begun crude oil production from the nation`s first deep-sea oilfield in Krishna Godavari (KG) basin, an accomplishment that the firm may announce in the next few days.
The company`s predominantly gas-rich D6 block in KG basin on September 17 flowed first oil, said a source in the consortium of Reliance Industries and Niko Resources of Canada which operates the block.
Block KG-DWN-98/3 or D6 will be the first area in deep-sea to produce crude oil since India opened up its oil hunt programme for private and foreign players in 1999 with the advent of New Exploration Licensing Policy (NELP).
The Mukesh Ambani-led group operates India`s largest refinery at Jamnagar in Gujarat and will start production from another only for exports unit in next couple of month. It will however not refine the D6 crude at its refineries and instead sell it to state refiners.
It is said that the company has initially opened one of the two oil producing wells in the MA oilfield in the D6 block.
Oil flowed at the rate of 200 barrels a day but once system stabilizes, the choke will be fully opened to produce more. Once both the wells are in full operation, the output will rise to 10,000 to 15,000 barrel a day within weeks.
Two more wells are planned to be drilled on the field which would raise the output to 34,000 barrels a day (1.7 million tons a year.)
Reliance is likely to sell 0.8 to 1 million tons of oil from the field to Hindustan Petroleum`s Vizag refinery while the remaining output will go to Chennai Refinery, a subsidiary of Indian Oil Corporation.
The company earlier this week successfully installed floating production storage and offloading system (FPSO) on the oilfield.
Shares of the company gained Rs 119, or 6.16%, to settle at Rs 2,052. The total volume of shares traded was 1,667,912 at the BSE (Friday).
No comments:
Post a Comment