Reliance shrugs off media hype about D3 find

Vol 13, PW 16 (28 Jan 10) Exploration & Production

Reliance is shrugging off media hype about a recent gas discovery at NELP-V Krishna Godavari deepwater block KG-DWN-2003/1, also known as D3.

Reliance (90%) issued a statement on December 22 announcing its third successive gas discovery at the 3288-sq km block, where it partners London-based AIM-listed Hardy Oil (10%). Well KG-V-D3, drilled by Transocean-owned deepwater drillship Deepwater Expedition in 1982 metres water depth to a total depth of 4113 metres, was described in a string of breathless news reports as a “gas gusherâ€‌ and a potential source of new income for the Mukesh Ambani controlled company.

Hardy chief operating officer Yogeshwar Sharma was also widely quoted saying total estimated â€کresources’ at D3 were in the region of 9.5-tcf. But an industry source clarifies to PETROWATCH that this estimate “is not a Reliance positionâ€‌ because the company is still unclear if the discovery is commercially viable.

Reliance, we hear, has not bothered to carry out a conventional Drill Stem Test (DST), choosing instead to go for cheaper and faster Reservoir Characterisation Imaging (RCI) technology. “DSTs are carried out only if the well looks promising,â€‌ we hear.

Carrying out a DST, adds a source, could take between 15 to 50 days and cost between $10m to $20m, as the rig needs to stay at the well the entire time. Contrast that with RCI testing, where a â€کprobe’ is sent down the well to take a core sample, which is analysed so results can be extrapolated for the rest of the well.

“RCI results are available almost instantly,â€‌ we hear. “Reliance is still waiting for the analysis.

No decision has been taken on the way forward.â€‌ Reliance is currently analysing its RCI results for well KG-V-D3 and integrating those with other information from the D3 block.