DGH blocks GSPC work at CB-ONN-2000/1

Vol 15, PW 6 (22 Sep 11) Exploration & Production

GSPC has found an unlikely ally in the oil ministry, which is pressing the DGH to speedily approve its Field Development Plan (FDP) for the Sanand East-1 oil discovery at onland Cambay basin block CB-ONN-2000/1.

PETROWATCH learns the ministry wrote to the DGH on September 19 asking it to drop its opposition to the FDP for GSPC’s 1424-sq km block, where it partners GAIL. For the past 18 months, the DGH has withheld approval, saying the FDP was submitted late.

It believes the FDP should have been formally submitted in October 2009 under the PSC. A consortium source admits the FDP was submitted only in February 2010 but adds this was because of additional ‘technical work’ suggested by the Management Committee.

“We originally submitted the FDP to the Management Committee by October 2009,” he says. “But DGH officials on the MC asked us to downgrade our reserves estimate so we had to revise our ‘techno-commercial’ evaluation and this took time.

” GSPC and GAIL then recalculated the reserves estimate and formally re-submitted the development plan four months later. “There is no set timeline defined in the PSC for ‘incorporating advice’ from the MC,” adds a ministry official.

“There was no delay in submitting the FDP, going by provision 10.7 of the PSC.” CB-ONN-2000/1 was one of the most fiercely contested in NELP-II and originally won by a consortium of GSPC, GAIL and US-based minnow Joshi Technologies.

Signed on July 17, 2001, the PSC kicked-in on January 7, 2002 when GSPC received the PEL. Joshi later quit leaving GSPC and GAIL as equal partners, with 50% each.

“We have invested years of time and Rs41cr ($8.4m) on the Sanand East-1 discovery at this block,” adds our consortium source. “We cannot just let it go now.