Reliance strikes oil in KG basin

The firm will now need to establish the commercial viability of reserves.

Reliance Industries Ltd has struck oil in Krishna Godavari basin in the Bay of Bengal. The discovery has been made in a block close to Reliance's certified gas rich D6 block in the KG basin.

"Reliance submitted a discovery note on December 15 and we have certified that a discovery has been made," Director General of Hydrocarbons VK Sibal said, adding that about 3,000 barrels-a-day oil flowed during the initial drilling which was not significant for an offshore block.

The company would now need to establish the commercial viability of reserves. The find would then be placed for certification by the DGH which was a regulator for exploration and production of oil and natural gas in the country.

On its part, the RIL informed the Bombay Stock Exchange and the National Stock Exchange that no certified "commercial" oil discovery had been made.

"The company is in the process of exploration of various blocks in KG basin and if there is any certified commercial oil discovery in any of its blocks, it will inform the regulatory agencies as well as its shareholders," said the notice.

The discovery is unique on two counts: This is the first on the NELP (New Exploration Licensing Policy) block and the development was announced by the hydro-carbon regulator while the company refrained from making any comments.

It may be mentioned that the country's largest oil and natural gas company ONGC was caught in a controversy on whether a company has the right to announce any discovery without getting the regulator's approval.

RIL drilled about 3,000 metres from the platform, said Sibal. He said RIL struck oil in its Dhirubhai-24 well and oil and gas in Dhirubhai-25 well in block KG-OSN-2001/2.

The block was awarded to the company in the third round of bidding under the NELP. Dhirubhai-24 well floated 2,400 to 2,700 barrels of crude oil per day while Dhirubhai-25 floated 3,012 barrels of oil and 2.6 million standard cubic metre per day of gas.

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OIL RUSH

The discovery has been made in a block close to Reliance's certified gas rich D6 block in the KG basin

The firm will now need to establish the commercial viability of reserves

The find will then be placed for certification by the DGH

RIL, however, informed the BSE and the NSE that no certified "commercial" oil discovery had been made