A meeting of an oversight panel to vet Reliance Industries' $1.529 billion investment plan for development of satellite fields in the KG-D6 block was postponed today after government representatives declared themselves unavailable for the meet.
Oil Ministry Joint Secretary (Exploration) D N Narasimha Raju and Directorate General of Hydrocarbons Director General S K Srivastava, who had confirmed participation in the Management Committee meeting scheduled at 1130 hours today, recused themselves at the eleventh hour, citing personal reasons, sources privy to the development said.
The oversight panel, called the Management Committee, was to consider giving approval to the proposal by RIL to develop four satellite fields in the flagging KG-D6 block.
Development of the four fields by 2016 would help arrest the fall in output in the producing fields.
Sources said no new dates have been intimated for the MC meeting. Raju, who along with Srivastava did not attend the last KG-D6 MC meeting on December 2 that failed to approve the development plan, is completing his deputation to the Oil Ministry on January 5, 2012.
Incidentally, a separate meeting of the MC on blocks operated by state-owned Oil and Natural Gas Corp (ONGC) took place as scheduled this afternoon.
The KG-D6 MC was to consider the Field Development Plan for the Dhirubhai-2, 6, 19 and 22 (D-2, D-6, D-19 and D-22) fields surrounding the currently producing D-1 and D-3 fields.
The fields can produce 10 million cubic metres of gas per day by 2016 and will help shore up output from the block, which has seen a 35% drop in output in the past 15 months.
The MC had in its last meeting on December 2 refused to approve the investment plan, saying the proposal made in December, 2009, was based on the prices of that year and new rates needed to be worked out at the current prices.
Sources said RIL and its partners, UK's BP Plc and Niko Resources of Canada, felt reworking the rates would require several months and would lead to the loss of the four-month fair weather window in the Bay of Bengal that began this month.
As a compromise, RIL agreed to cap spending on the four fields at $1.529 billion, plus or minus 15%.
This includes $30 million on pre-development activities that RIL and BP have insisted on taking up during the next quarter, including pre-engineering and other studies.
RIL has so far made 18 gas discoveries in the KG-D6 block. Of these, D-1 and D-3 -- the largest among the lot -- were brought on to production from April, 2009, but output has fallen from 54 mmcmd, reached in March, 2010, to 31.86 mmcmd this month.
Together with 6.83 mmcmd of associated gas produced from the MA oilfield in the same area, total production from the block is 38.66 mmcmd.
