Reliance to produce 5m cm/d from two CBM blocks

Vol 11, PW 5 (12 Jul 07) Exploration & Production

Reliance's development plans for two CBM blocks in Madhya Pradesh are likely to receive DGH approval within “the next 10 to 15 days.

â€‌ PETROWATCH learns Reliance submitted plans for the Sohagpur East and Sohagpur West concessions around one and a half months ago. Under PSC terms, the DGH must approve it within 90 days of submission by the operator.

Reliance expects to spend close to $1bn over the life of both blocks. A five-year development plan, beginning sometime this year, will see Reliance drill 250 development wells at both blocks, at an approximate cost of Rs1200cr ($300m).

"Reliance wants to produce 5m cm/d of CBM gas from both these blocks together,â€‌ reveals a source. “It wants to maintain a â€کplateau’ production profile of 5m cm/d for 15 years.

â€‌ Why 15 years "Any downstream project needs an assured supply of gas for a minimum 15 years. Reliance could produce 10m cm/d for five years and bring it down later but what's the point of doing that" During the entire life of both blocks, Reliance will drill 600 wells at Sohagpur West and 750 wells at Sohagpur East.

“To maintain 5m cm/d production over fifteen years, Reliance might have to drill a total of 1000-1200 wells,â€‌ says a CBM expert. “This is likely to cost $1bn.

At any given point of time, 500-600 wells will be producing at both blocks.â€‌ Reliance is in Phase-II of the exploration programme at both blocks and has just completed a drilling campaign of around 40 wells using rigs from Mitchell Drilling and John Energy.

Reliance has hired three rigs from Mitchell Drilling: one for coring operations, the second to drill production wells. A third, also for production wells, is on standby.

John Energy's rig, John 2, is still on location, but John 15 is on its way to Rajasthan for another contract. "Work at both Reliance blocks is slow these days because of rains," we hear.

Mitchell Drilling is drilling horizontal and cavity completion wells using 'inseam drilling' technology.

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