Environmental delay to blame at six Reliance blocks

Vol 9, PW 24 (23 Mar 06) Exploration & Production

Reliance claims problems with the environment ministry have delayed exploration work in six of the 23 blocks under scrutiny, compelling it to ask for time extensions through no fault of its own.

Take pre-NELP offshore Gujarat block GK-OS/5, where Tullow Oil holds 50%, and which sits in the Coastal Regulation Zone. Any activity here requires mandatory approval from the environment ministry.

This is still awaited and Reliance is unable to drill the one well committed in Phase-II of its work programme. It has already shot the required amount of 2D and 3D at GK-OS/5 but wants an open-ended extension of Phase-II until environment ministry permission is received, after which it wants a 12-month extension to drill the well.

Reliance is making a similar request for offshore Gujarat pre-NELP block GK-OSJ/3 where it has exceeded the 2D and 3D commitments but has yet to drill the one committed Phase-II well. Here the environment ministry has asked Reliance to carry out studies on the likely disturbance to the local flora, fauna and mangroves.

Awarded to Reliance in September 2001 under the joint venture licensing round, GK-OSJ/3 is one of the few blocks where it has an alliance with state-owned oil companies: ONGC (20%) and Oil India (15%). Similar is NELP-I block SR-OSN-97/1 in the Saurashtra basin offshore Gujarat where Reliance has already received an 18-month extension.

It has shot the required amount of 2D but the one committed well has not yet been drilled. Reliance says it needs another 12 months from the date of clear environmental clearance till which time it wants an open-ended extension.

This is Reliances demand even at offshore Gujarat pre-NELP block SR-OS-94/1, also in the Saurashtra basin, where it has received a 10-month extension but is unable to drill one committed well thanks to lack of environment ministry clearance. Luckily for Reliance, we understand it is likely to receive extensions in all these cases because as the delay is due to matters beyond its control.

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