India’s Gujarat Petroleum strikes record gas find

AHMEDABAD — India’s state Gujarat Petroleum Corp (GSPC) has made the country’s biggest gas discovery — 20 trillion cubic feet, worth $50 billion — off the southeast coast, Gujarat’s chief minister said yesterday.

The find was made in the Krishna Godavari (KG) basin at an offshore deep sea well 6km (4 miles) off the Yanam Kakinada coast in Andhra Pradesh state. “The team of GSPC experts detected gas around in the first week of June, 2005, after intensive drilling up to 5,061 metres into the seabed at a temperature of 400 degrees Fahrenheit (204 Celsius),” chief minister Narendra Modi told reporters.

India’s biggest gas find until now — 14 trillion cubic feet — is also in the KG basin, being developed by Reliance Industries and due to start producing by August, 2008.

The latest find comes as India faces pressure from the United States not to go ahead with plans for a $4 billion pipeline to pump natural gas from Iran through Pakistan.

Washington, which opposes Iran’s nuclear programme, has not ruled out imposing sanctions on India if the pipeline goes ahead.

It is not yet clear what impact the weekend election of conservative Mahmoud Ahmadinejad as Iran’s president will have.

GSPC plans to invest 15 billion rupees ($345 million) exploring in the KG basin, where it is also developing a block with Canada’s Geoglobal Resources and Jubilant Enpro.

GSPC has grown from operating small fields in Gujarat into a major national oil and gas explorer and producer with 21 oil and gas blocks in six years.

India, one of the world’s largest energy consumers and importers, has seen a spate of oil and gas discoveries.

GSPC stuck oil in an exploration block in the west last year, with estimated reserves of 50 million tonnes. India’s recent major discoveries added 4.4 billion barrels of hydrocarbon reserves in the past two years.

India is wooing exploration investment and encouraging its own firms to buy into foreign projects to meet rapidly rising energy needs in Asia’s fourth-largest economy. It expects oil demand to grow 4-5 per cent a year for 20 years as the economy expands 7-8 per cent.

The director-general of hydrocarbons, V. K. Sibal, confirmed to The Telegraph that the discovery made by Gujarat State Petroleum (GSPC) was “a very good gas find”, but added that it was too early to quantify the amount of gas that was in place. The reserves were earlier estimated at 20 trillion cubic feet by GSPC.

“More wells will have to be drilled in the field to enable us to arrive at an estimate of the amount of gas that has been discovered,” he said.

“Production testing is going on and the appraisal wells that will be drilled in the next few days will make the picture clearer,’’ he added.

He said at this stage “we cannot attach an exact figure to the find”.

The gas pressure from the successful well was as high as 10 million cubic feet per day, which brightened the field’s prospects. “If the pressure of the gas from the appraisal wells also turns out to be high, we will know for certain that it is a big find and can arrive at an estimate of the in-place reserves. On the other hand, if the gas pressure at the new wells drops, the estimate will have to be scaled down.”

An upbeat Sibal said, “The discovery has opened up a new area for oil and gas exploration. The gas has been struck in a much older rock formation that is deeper down in the earth. It is different from the ones in which Oil and Natural Gas Corporation and Reliance had made their discoveries.”

While the exploration block is in the shallow waters of the Krishna-Godavari basin, the gas has been struck deep down at a depth of 4,700 metres.

Gujarat State Petroleum deputy general manager M. Y. Farooqui said the range of the discovered gas column extended from 800 to 850 metres and given the high pressure of the gas, the company had arrived at the estimate of 20 trillion cubic feet for the in-place gas reserves.

However, he admitted that more appraisal wells would have to be drilled to confirm the estimates.

Farooqui said the discovered zone stretched across an area of 75 square km. It forms part of a larger exploration block covering 1,850 km, which GSPC has been exploring. Two wells drilled earlier in this block had turned out to be dry. It is the third well that has turned out to be lucky for GSPC.

The biggest gas find in the country in recent years has been by Reliance, which was also in the Krishna-Godavari basin. Reliance had initially claimed that the in-place reserves were around 4 trillion cubic feet.

Later, the company had revised this estimate to 7 trillion cubic feet and then to 10 trillion cubic feet.

Oil and Natural Gas Corporation had also announced a gas discovery in the offshore Krishna-Godavari basin on Thursday in its GS 15 block.

However, the public sector oil giant is usually more cautious in placing any claims on the estimate and has stated that appraisal wells will now be drilled to ascertain the exact amount of gas in the field. The discovery was made near the mid-sized Ravva oilfields.

The GSPC discovery is the fourth one in the basin, which is emerging as a potentially rich hydrocarbon area. Discoveries in the past such as Mumbai High have been made mainly in the western offshore area.



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