Reliance and ONGC to work together in Cambay

Vol 20, PW 22 (27 Jul 17) People & Policy
     

Nobody wants a repeat of Reliance and ONGC's gas migration drama, least of all the principal actors.

Which is why on July 17 representatives from Reliance and ONGC met at the DGH office in Noida to discuss jointly developing Reliance's 635-sq km onland Cambay basin block CB-ONN-2003/1 in Gujarat which shares a reservoir with the 81.25-sq km Akholjuni licence, a pre-NELP block held by ONGC. "Reliance's reservoir extends into ONGC's acreage," reports a source.

"Reliance and ONGC discussed ways to avoid future conflict." DGH officials are relieved the two companies have discovered the shared reservoir before development. "The DGH is already handling a gas migration dispute between Reliance and ONGC," we learn.

"Nobody wants a repeat show." Some believe Reliance is playing a shrewd game, however. On the one hand it's proposing joint development but on the other it is trying to offload its 70% stake at CB-ONN-2003/1.

This month (July) Reliance opened a dataroom in its Mumbai office for interested buyers. "Reliance is a big company and the Cambay block is too small," we hear.

"Reliance has lost interest in E&P and doesn't want arbitration headaches with the government." BP, which holds the remaining 30%, also reportedly feels the Cambay block is not worthwhile. On the east coast Reliance is accused of 'unjust enrichment' by selling gas which migrated from ONGC's eastern offshore KG-DWN-98/2 and G4 blocks to its own KG-DWN-98/3 block.

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