The Hindu : Business : Reliance strikes gas off Orissa coast

Online edition of India's National Newspaper
Friday, Jun 25, 2004

Business

Business

Reliance strikes gas off Orissa coast

By Ramnath Subbu

MUMBAI, JUNE 24. In a significant development in oil and gas exploration, Reliance Industries has struck gas off the Orissa Coast in the Bay of Bengal in the exploration block NEC-OSN-97/2.

Addressing the shareholders at the company's 30th annual general meeting here today, the Chairman of Reliance Industries, Mukesh Ambani, said, "These discoveries are being named as Dhirubhai 9, Dhirubhai 10 and Dhirubhai 11. We have made an initial estimate of the potential from seismic and other studies, which indicate an in-place volume of about 4-5 trillion cubic feet. We will, however, declare the value only after we have a certificate," said Mr. Ambani.

Also, last year, the company had struck oil in an onshore block in Yemen, where Reliance has a 25 per cent interest. While four wells were drilled, three discoveries were made and the share of recoverable oil reserves for Reliance from this block is estimated at 50-60 million barrels. "These discoveries are being referred to as Dhirubhai 12, Dhirubhai 13 and Dhirubhai 14. We are taking steps to bring this field to production during this financial year," said Mr. Ambani.

The Chairman said work on the KG-D6 block was progressing and "a development plan to produce 40 million cubic metres a day of gas initially from the KG-D6 block by the year 2006-07 has been submitted to the Directorate General of Hydrocarbons. We have identified credit worthy customers for 80 million cubic metres a day of gas. Reliance has emerged as the lowest bidder for the supply of three million tonnes annually (12 million standard cubic metres a day) of gas to NTPC."

Further, Mr. Ambani said the company was also looking at value generation opportunities overseas as tools for energy security for the company. Geographically, the regions of focus are Africa, Middle East, Australia and Latin America."

Another area is the development of coal bed methane (CBM) projects in which India is estimated to have a resource potential of 35-40 trillion cubic feet. In the current year, RIL won two more CBM blocks in the second round of bidding and thus has five blocks in Madhya Pradesh, Chattisgarh and Rajasthan. Mr. Ambani said seven `information' wells were drilled and have CBM potential greater than expected.

Over the next three years, the current petrochemical capacity of 12.4 million tpa will go up to 15 million tpa. In petroleum refining and retailing, Reliance operates the world's third largest refinery at Jamnagar and Mr. Ambani said Reliance had commissioned over 75 outlets in various parts of the country. "Reliance is on course to building 5,849 petroleum retail outlets over the next 3-5 years throughout India, the largest grassroots roll-out ever undertaken by any enterprise."

Reliance Infocomm's expansion

Reliance Infocomm's services are being expanded from about 1,100 towns to about 5,000 towns in a phased manner. The second phase expansion will result in Reliance Infocomm being available to over one lakh villages and on completion can cater to 40 million mobile subscribers. "A significant ongoing technology effort by Reliance Infocomm is in multi-lingual speech recognition in ten Indian languages," Mr. Ambani informed.

The next big initiative for the company is a broadband revolution. "We are rolling out broadband services on our network in a comprehensive manner covering all products available in the narrow to broadband range.

"Investments in greenfield telecommunication projects typically take seven to ten years all over the world to yield returns. I am confident that Reliance Infocomm will take less than half this time to generate superior returns on investments," said Mr. Ambani.

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