Reliance, BP to develop third gas project in India

New Delhi: Reliance Industries Limited (RIL) and its exploration and production partner BP Plc on Tuesday announced the sanction of the MJ project (also known as D55) in Block KG-D6, a deep water gas field off the east coast of India.

MJ is the third of three new projects in the Block KG-D6 integrated development plan and its approval follows sanctions for the development of ‘R-Series’ deep-water gas field in June 2017 and for the Satellites cluster in April 2018.

"Together the three projects are expected to develop a total of about 3 trillion cubic feet (tcf) of discovered gas resources with a total investment of circa ₹35,000 crore ($5 billion). These projects together, when fully developed, will bring about 1 billion cubic feet a day of new domestic gas onstream, phased over 2020-2022," RIL said in a press statement on Tuesday.

Mukesh Ambani, Chairman and Managing Director of RIL, said: “Bringing these three discoveries to production, as promised in 2017, by leveraging the existing infrastructure has been the primary objective of the Reliance-BP Joint Venture. The gas will satiate the increasing demand for clean fuel in the country, save foreign exchange and reduce dependency on imported gas...and help strengthen energy security while moving towards meeting India's Climate Change Goal."

MJ is a gas condensate field and is the third field under development as part of the KG-D6 integrated development campaign. The project is in 700-1,100 metres water depth, with a well depth of 4,200 metres below mean sea-level in a high-temperature and pressure environment.

It comprises of wells connected to subsea production, with tie-back to a Floating Production Storage and Offloading (FPSO) vessel to process and separate liquids, and gas which will be exported to the onshore terminal through one of the existing 24-inch trunk pipelines.

Bob Dudley, BP Group Chief Executive, said, "We are building an important upstream business in India, helping to supply the country’s growing gas market. Working closely with Reliance, we are efficiently developing discovered resources, with focused exploration to give options for the future,"

India today consumes over 5 billion cubic feet a day of natural gas and aspires to double gas consumption by 2022. RIL said gas production from KG-D6 integrated development is expected to help reduce India’s import dependence and amount to over 10% of the country’s projected gas demand in 2022, thus benefiting the country and domestic consumers at large.

The first of the three KG D6 projects under development, the R-Series project, is in the execution phase. First gas from this project is on schedule and expected by mid-2020. The second project, the development of the satellites cluster, is on track with all major contracts awarded to deliver first gas by mid-2021. The MJ project will draw on execution synergies with the R-Series and Satellite projects being developed concurrently.

Disclaimer: This information has been collected through secondary research and IBEF is not responsible for any errors in the same.