New Dehi: UK-based BP Plc and its Indian partner Reliance Industries Ltd (RIL) will quadruple natural gas output in the country by 2020, said Sashi Mukundan, Regional President and Head of Country, BP India, on Wednesday.
While addressing the 12th Petro India Summit organised by the India Energy Forum here, he did not give any number on the quantum of output, but said all blocks its joint venture has in India will see output quadruple.
“With the two recent significant deepwater discoveries, our exploration effort is well on the way to unlock the next major hub for development in the East coast. An opportunity awaits the BP-RIL joint venture to quadruple production by 2020 as we rework the fields and get into the next phase of development of already discovered resources,” he said.
Mukundan added the joint venture alone could help bring down India’s import bill by $100-$150 billion.
“We had two discoveries in Cauvery. We are getting ready to drill wells next year (2014). All these together give us the feel that there is lot of potential,” he said. “Our main purpose is to make sure that we continue producing from D-1 and D-3 fields in the D6 block. If we get the right regulatory framework, we would see much more production coming out of our blocks than what you are seeing today.”
The explorers have completed a new well at the MA field that is expected to produce starting next month. Also, it is reviving three existing wells at the D1 and D3 fields in the KG basin. Currently, the KG D6 block produces less than 10 mmscmd.
Asked how much investment the explorer is looking at, Mukundan said: “We talk about somewhere around $5-10 billion. It is important that we get the right enabling regulation to move forward.”
The BP executive added it is important to get clarity on pricing of natural gas to go ahead with the development programmes. “We need to have a clear pricing policy. This is important to have broader development of the KG D6. We got whole bunch of new discoveries which we need to bring on (to production). We have got R-Series project, which is getting ready to make an investment decision. It is important we have the pricing regime understood. That is the critical bit.”
Pricing issue
Meanwhile, Vivek Rae, Secretary at the Ministry of Petroleum and Natural Gas, said the Finance Ministry has sent its response on the issue related to pricing of natural gas.
He, however, did not divulge if the Finance Ministry has agreed to the proposal made by the Petroleum Ministry.
The latter is of the view that if RIL wants to benefit from the revised gas price, it should submit a bank guarantee for the unmet supply commitment from its KG-D6 block.
The Cabinet Committee on Economic Affairs will take the final decision on the issue.
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