With RIL's KG-D6 output playing truant, steps need to be taken to stabilise the country's natural gas production.
The Mukesh Ambani-led Reliance Industries Ltd (RIL) might take a write-down on the KG-D6 block.
The agreement, which will be reviewed at the end of five years, will boost profitability of the steel firms who had been buying expensive LNG or naphtha to meet feedstock shortage at their plants, a senior official said. The ministry of petroleum and natural gas had last week asked Reliance to sell natural gas to steel firms like Essar, Ispat and Vikarm Ispat to help the nation's most prolific gas field to produce at optimum level.
A division bench of Justices J N Patel and K K Tated said that the new agreement should be as per the memorandum of understanding between the Ambani brothers Mukesh and Anil. The MoU stipulates that RIL would supply 28 mmscmd of gas to RNRL for 17 years at the rate of $2.43 per million British Thermal Units.
The Krishna-Godavari (K-G) basin may prove to be a much bigger play for Reliance Industries Ltd. This follows the announcement that its D4 block could hold twice the reserves of the in-production D6 block to the north.
The company has already received an approval to spend Rs 50,000 crore (Rs 500 billion) for commercialising two of its biggest gas discoveries in the D6 block located in the KG basin. "In a letter to oil regulator Directorate General of Hydrocarbons, the company has submitted one more development plan for Rs 10,000 crore as additional capex (capital expenditure) for the block.
The Oil and Natural Gas Corporation plans to invest over US$ 5 billion to produce 25 million standard cubic meters per day of gas from its eastern offshore Krishna Godavari fields by 2013. The state-run firm on Wednesday submitted to the regulator Director General of Hydrocarbons an appraisal programme of the discoveries it had made in the KG offshore basin, putting the in-place reserves at 6.37 trillion cubic feet. ONGC also plans to produce 8,000 barrels of oil per day.
The official explained that the contractor would take the worst-case scenario into account "to be on the safe side", when working out the field development plan and the probable cost of exploration and development of the block.
RIL expects oil and gas sales from the Krishna-Godavari basin to boost its revenues and profits significantly. The company started test production of oil from the basin around 10 days ago. The cost of production per barrel of oil is not known. RIL's share price on the Bombay Stock Exchange has fallen 9.3 per cent in the last month as world markets have tumbled on fears of an economic crisis.
Bharat Petroleum Corporation lans to invest around Rs 6,000 crore (Rs 60 billion) in the exploration and production business over the next few years.
"On the sensitive issue of the huge price rise demanded by natural gas exploring companies in the Krishna-Godavari basin, Modi tried to be evasive but indicated that if required the price may have to be increased," says the interviewer, Dilip Gohil.
Higher price will lead to hike in fertiliser subsidy while a lower price will hit returns.
ONGC takes Reliance to court, alleging years of stealing from its offshore block and a sleeping govt, right after it was agreed there would be a probe by experts.
RIL has denied knowingly producing any gas from the ONGC block
In an 85-page note to the Group of Ministers set up to look into the bifurcation of Andhra Pradesh, Chief Minister Kiran Reddy on Monday raised 36 crucial points why a separate state of Telangana is not desirable.
RIL had drawn 58.67 bcm of gas from four wells.
For India's upstream sector that has seen no new discovery coming into production.
Reliance Industries Ltd on Friday reported a 9 per cent rise in its December quarter net profit as a planned maintenance-induced weakness in oil business earnings was offset by stability in retail and telecom verticals. The oil-to-retail-to-telecom conglomerate's consolidated net profit of Rs 17,265 crore, or Rs 25.52 per share, in October-December - the third quarter of the current 2023-24 fiscal - was 9.3 per cent higher than Rs 15,792 crore, or Rs 23.19 a share, earning a year back, according to a company statement. Quarter-on-quarter, the profit was lower when compared to Rs 17,394 crore earnings in the preceding three months ended September 30.
The move is likely to force the government to take a faster decision.
The Delhi high court (HC) division Bench on Thursday sought a response from Reliance Industries (RIL) and others regarding the government's appeal against the Mukesh Ambani-owned conglomerate and others for fraudulently and unjustly enriching themselves by draining gas from their deposits, amounting to over $1.5 billion. The Centre had appealed against the single-judge Bench order of the Delhi HC on May 9, which had dismissed its petition. Justice Anup Jairam Bhambhani had upheld the international arbitration award of July 24, 2018, in favour of the RIL-led consortium. The consortium includes UK-based BP Plc and Niko Resources of Canada.
Reliance Industries Ltd (RIL) said on Wednesday that the government's move to disallow it recovery of certain costs relating to the D6 gas block in the Krishna-Godavari basin (KG-D6) did not amount to a penalty and was also not in line with the contract the two had signed.
BP, which bought a 30 per cent stake in RIL's 21 oil and gas blocks, including KG-D6, for $7.026 billion in 2011, is working with RIL to arrest the output decline in the fields.
Reliance Industries and its partner BP Plc on Thursday won approval to invest $3.18 billion in R-Series gas field in the flagging KG-D6 block.
State-owned Oil and Natural Gas Corp (ONGC) has signed a contract to hire a long-idled ultra-deepwater drillship of US-based Transocean for $412,000 (about Rs 2.39 crore) per day.
Contract does not provide for retrospective penalty for 'such' acts
'If the government starts playing favourites, if the government acts in a manner which is not transparent, then natural resources which belong to not just you and me, but future generations, they fritter away. The anger against corruption, the anger against India's natural resources being looted is a consequence of the fact that within society there is a huge amount of turmoil and discontentment. Why should an Empowered Group Of Ministers or the Cabinet Committee on Economic Affairs decide the administered price of gas?' asks Paranjoy Guha Thakurta in this exclusive interview with Rediff.com's Sheela Bhatt.
RIL has slapped an arbitration notice challenging oil ministry's decision to take away 814 square kilometer of its eastern offshore KG-D6 area that contained five gas discoveries.
While government/PSU procedures focus on piece meal & individual tenders taken on standalone basis, avoiding delays and cost of not doing things becomes a primary consideration in PSC procurement
Gas production from Krishna Godavari basin block has dropped to just over 12 mmscmd and RIL is carrying out workover on main Dhirubhai-1 and 3 gas fields.
The government has formed a four-member panel of secretaries to suggest a new gas pricing mechanism.
The company had received a loan restructuring package from banks under the 5/25 scheme last year.
The newer gas finds will help turn the tide for ONGC, which has seen oil and gas output stagnating in recent times.
If proved correct, MJ-1 would the third biggest gas field in KG-D6 after D1&D3.
Training his guns on BJP's prime ministerial candidate again over the Reliance gas issue, the Aam Aadmi Party on Friday asked Narendra Modi whether he will bring down the gas price if he comes to power.
The withdrawal of the arbitration will now entitle the two companies to marketing and pricing freedom on the natural gas they produce from newer fields in the deep sea at an investment of Rs 40,000 crore by 2022.
President Pranab Mukherjee, the former trouble-shooter of the Congress party, may informally 'guide' the Union government in drafting the bill on the creation of Telangana.
A report, by DeGoyler and MacNaughton, has put a question mark on the future production from the five ONGC discoveries.
According to a source close to the development, the government is set to come out with a notification in this regard by the end of this week.
Keshav Joshi's tongue in cheek look at Narendra Modi's mega plans.
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