RIL, Niko strike oil in KG basin

Reliance Industries (RIL) and its partner, Canada-based Niko Resources ,have discovered oil in the hydrocarbon rich Krishna-Godavari basin.

According to an announcement on the Niko Resources website today, the companies have discovered "the thickest hydrocarbon column to date" on the D6 block in the KG basin.

The announcement dated December 15 said the two had discovered a column of gas condensate of 170 m and 24 m of oil bearing hydrocarbons. While RIL has 90 per cent stake in the block, Niko holds the rest.

The Niko website also said: "Application for monetising the gas discovery has been sent to the Directorate General of Hydrocarbons (DGH). The company plans to start production from the second quarter of 2008." V K Sibal, director general, DGH, however, said the directorate was yet to receive the application.

RIL first discovered oil in the area in June this year and had another gas find in September. The area, first discovered in 2002, might hold as much as 35 trillion cubic feet (tcf) of gas, Niko Resources said.

Today's announcement comes in the wake of ONGC's discovery of 22 TCF of gas in the KG basin. Taken together with Gujarat State Petroleum Corporation's gas find estimated at 20 tcf, the KG basin could emerge as the answer to the country's quest for hydrocarbon requirement, analysts said.

Reliance, on November 1, doubled its spending on the country's largest gas field, also in the KG basin, to $5.2 billion and raised its estimate of output to 80 million cubic metres of gas a day "� equivalent to the country's current consumption.

India is Asia's third-largest oil consumer and is actively promoting oil exploration to boost domestic production.