Oil and Natural Gas Corporation has told oil regulator DGH that its KG basin block may hold about 3 trillion cubic feet of gas reserves from which it plans to produce 25-30 million unit a day by 2016.
ONGC last week submitted a proposal for declaring nine gas discoveries in the northern area of block KG-DWN-98/2 commercially viable, company sources said.
Once Directorate General of Hydrocarbons (DGH) approves the commercial viability of the nine finds, ONGC will make a formal field development plan (FDP) outlining the specifics of producing gas from the find.
ONGC has tentatively put investment required for bringing to production Padmawati, Kanakadurga, Annapurna, N-1, D/KT, U, A, W and E gas finds in the Northern Discovery Area (NDA) of the block at over $5 billion, sources said.
As the discoveries are not independently viable, the firm plans to tie them with finds in neighbouring acreage and developing them as a cluster. ONGC envisages 25-30 million standard cubic meters per day of output from NDA fields and G-4 and GS-29 finds in neighbouring acreage by 2016.
ONGC's KG-DWN-98/2 block sits next to prolific KG-D6 block of Reliance Industries in the Krishna Godavari basin off the east coast.
The state-owned company had a few months back put an investment requirement of USD 4.05 billion for producing natural gas from ultra deep sea UD-1 discovery in the southern part of the KG-DWN-98/2 block.
Sources said UD-1 is being planned to be developed separately and together with NDA fields, ONGC's total spending would be in the region of $10 billion.
DGH has so far not approved comerciality of the UD-1 find that on its own may hold 3.4 Tcf of in place gas reserves, of which 55.7 per cent or 1.904 Tcf are recoverable.
ONGC has 65 per cent interest in KG-DWN-98/2 block while Cairn India has 10 per cent. Petrobras of Brazil holds 15 per cent and Statoil the remaining 10 per cent. Petrobras and Statoil have, however, decided to exit the block.
Sources said ONGC has so far drilled a total of 13 exploratory wells in the 7,294 sq km block that is divided into northern and southern appraisal areas.
The Northern Discovery Area (NDA) consists of Padmawati, Kanakadurga, Annapurna, N-1, D/KT, U, A, W and E gas finds in in water depths ranging from 594 meters to 1283 meters. The Southern Discovery Area consisting of UD-1 discovery in Ultra deepwater has a depth of 2841 meters.