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  • OracleAtDelphi OracleAtDelphi May 3, 2006 7:30 PM Flag

    GSPC KG Gas Find is Yet to be Validated

    GSPC�s KG Gas Find is Yet to be Validated

    Jyoti Mukul
    Wednesday, May 03, 2006 00:32 IST

    NEW DELHI: Gujarat State Petroleum Corporation (GSPC), which went to town some months ago claiming enormous gas discoveries in the Krishna-Godavari basin, is yet to receive an official certification on estimated reserves from the government.

    High temperatures and high pressures in the Bay of Bengal sea have prevented the company from even conveying its test results to the government.

    GSPC had submitted a gas discovery report to the directorate-general of hydrocarbons (DGH) in October, 2005, amid claims that the reserves would exceed 20 trillion cubic feet. But official sources said that the initial assessment for five identified layers showed gas reserves in the range 912 to 3611 billion cubic feet. That�s under 20% of GSPC�s claims. The DGH certification process is yet to be completed.

    The Gujarat government-owned company had initially dug two wells, KG-1 and KG-11, which were dry and duly abandoned.

    Gas was, however, discovered after drilling a third well, KG-8. When Gujarat Chief Minister Narendra Modi made an announcement about GSFC�s discovery in June, 2005, he claimed that the 20 trillion cubic feet of estimated reserves could be an underestimate. He expected production to begin by end-2007.

    As things stand now, the well did indicate gas during production testing, but the test was inconclusive due to sand ingression.

    DGH sources said conditions at the site were bad, but GSPC managing director DJ Pandian denies any such thing.

    While declining to elaborate, Pandian said: �We will submit the development plan at an appropriate time.�

    GSPC is carrying out exploration in the Krishna-Godavari block called KG-OSN-2001/3 off the coast of Andhra Pradesh.

    Both Reliance and Oil & Natural Gas Corporation have made claims of discoveries in this area. GSPC�s find is considered a �good discovery� by experts, but doubts remain about the actual level of recoverable reserves.

    GSPC holds an 80% stake in the block, with Geo Global and Jubilant Enpro Ltd holding 10% each. GSPC plans to start commercial production from 2007-end but sources say this is unlikely since conditions are difficult in the area.

    There is also a shortage of drilling rigs, which is also delaying commercial production at the Reliance block. GSPC�s website claims that KG-8 is the deepest offshore well in India, at 5,061 metres. The drillers faced one of the most adverse conditions ever encountered by any well in the world.

    OracleAtDelphi (OAD)

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