GSPC strikes oil, gas in KG basin

GSPC has discovered more gas and this time also oil from its KG Deen Dayal block well no 17. The new find is at 3,500 metre depth and from a crater which is spread in 60 to 90 square km area.

The new discovery is in addition to the previous one announced by state-owned GSPC last year, announced Saurabh Patel, Gujarat minister for power and petrochemicals in Gandhinagar on Wednesday.

However, the joy of latest discovery was marred by the fact that the commercial production of natural gas from KG basin has been rescheduled from December 2007 to December 2008 as GSPC is unable to find enough rigs and skilled manpower for commercial production.

"The hurricanes Katrina and Rita destroyed over 400 rigs in Gulf of Mexico and subsequent rise in crude prices worldover increased interest in exploration and production which jeopardized our plans for commercial production", said D J Pandyan, managing director, GSPC.

When asked about the recoverable reserves from the new gas find, Gujarat CM Narendra Modi refused to confirm any number but said GSPC has informed DGH about the discovery and its being assessed by DGH office.

To bring gas from the east coast to the west coast, GSPC has proposed to set up 3,000 km pipeline up to Ahmedabad.

Patel said the proposal has been approved by the central government. He added that no decision has been taken on investment on pipeline project.

"The pipeline will require huge investment so we may also explore possibility of some tie up with some existing players", said Patel.

GSPC succeeded in exploring gas bulk at the rate of 4.8 million standard cubic feet per day and oil bulk of 862 barrels per day from the new well.

The gas available from KG 17 well is much superior with higher C2 and C3 propane and Ethane upto 17 per cent and 80 per cent methane. With rich gas available, GSPC plans to have LPG separation plant either in Gujarat or in Andhra Pradesh.

The stock of high grade oil with light density from the well has raised hope for more oil as the new layer is located at lower depth of 3,500 metre which would reduce the cost of oil and gas production for GSPC and its partners in KG basin.