Business   

GSPC to invest $1 billion in KG basin

— PHOTO: PTI

HUGE POTENTIAL: Gujarat Chief Minister Narendra Modi at KG-22 oil and gas exploration rig in Deendayal Block of Krishna-Godavari basin on Thursday.

NEW DELHI: Gujarat Chief Minister Narendra Modi on Thursday announced that the Gujarat State Petroleum Corporation (GSPC) would invest Rs. 4,100 crore ($1 billion) to bring the eastern offshore Krishna Godavari basin gas field into production by 2011. He ruled out going public to fund the project.

GSPC, which is close to receiving government approvals for development plans for the KG-8 gas field, had struck more gas in the block KG-OSN-2001/3, Mr. Modi announced to media persons here through video conferencing from the discovery well KG-22 in the Bay of Bengal. “KG-22 alone holds three trillion cubic feet (tcf) of gas,” he said adding that the entire block in his assessment holds more than 20 tcf of reserves.

Mr. Modi said from 2011 GSPC would pump 8-10 million standard cubic meters a day (mscmd) of gas from the block where they made the first of the five gas discoveries in June 2005 in the KG-8 well. “We have taken capacity in Reliance Industries’ East-West (Kakinada to Baruch) pipeline to transport gas to Gujarat,” he remarked. KG-8, according to the development plan submitted to oil regulator Directorate General of Hydrocarbons (DGH), holds a minimum of 2.6 tcf and a maximum of 5.6 tcf recoverable reserves and can produce about 6 mscmd gas.

Gujarat Energy Minister Saurabh Patel, who was present during the interaction in Delhi, said the State Government, which owns 100 per cent in GSPC, had put on back burner the plans to sell 30 per cent stake to a foreign strategic partner like Chevron Corporation. He said the Government was looking at an IPO, a statement that was contradicted by Mr. Modi who said there were no plans for IPO. “We are a surplus State and do not need any financial support. We are financially sound and do not need to go to market,” Mr. Modi remarked.

Mr. Patel said that while the KG-8 well had in 2005 flowed 10 mscfd during testing, the KG-22 well flowed 27.3 mscfd. GSPC has till now discovered gas in three wells KG-8, 15 and 16. It had so far drilled 11 wells, with the last well encountering technical problems. The development plan submitted to the DGH was only for 15 sq. km. out of the 95 sq. km. shallow water block KG-OSN-2001/3, which had been since re-named as Deendayal.

Printer friendly page  
Send this article to Friends by E-Mail

Stories in this Section

Krishnapatnam port dedicated to the nation
Ranbaxy, Daiichi confirm deal
GSPC to invest $1 billion in KG basin
M&M unveils CNG pick-up vehicle
New products from Sony by September
Biocon Q1 net at Rs. 15 crore
Pakistan stock slump triggers protest
ICI India to set up new plant
Navigation products from Blaupunkt
Sensex retraces 13000 level
Cashing-in
STCL to procure vanilla beans
Global convention on Ayurveda
Exchange Rates
Bullion Rates
Take Solutions to assist in epilepsy research
Duncans to sell tea through ITC e-choupal
Polaris reports higher profit
Tata AIG Life ties up with Family Credit
Kirby bags order from Renault-Nissan
Universal Construction Machinery to expand

Copyright © 2008, The Hindu. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu