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BP, Reliance add to offshore India gas production
4/26/2021 12:00:00 AM

BP and Indian private-sector conglomerate Reliance Industries (RIL) have started production from a second ultra-deepwater gas field in the Krishna Godavari (KG) basin offshore India's east coast, four months after output got underway from the first field.

The new field, known as Satellite Cluster, is expected to achieve plateau production of about 6mn m³/d this year, the firms said.
Satellite Cluster is the second of three deepwater gas projects that the two firms are developing in the offshore block KG D6. Production at the R Cluster field started in December and will peak at around 13mn m³/d, while the MJ project is due to come on stream in the second half of 2022.
Output from the three areas combined is expected to peak at around 30mn m³/d by 2023, equivalent to about 35pc of India's current upstream production. RIL operates KG D6 with a 66.67pc stake, while BP holds the balance.
India's gas production rose by 11pc to 2.68bn m³ in March from 2.42bn m³ a year earlier, while total consumption increased to 5.58bn m³ from 5.3bn m³. The country's LNG import dependency fell to 53pc from 56pc in the same comparison.
RIL and BP have issued three tenders to sell a combined 18mn m³/d of gas from the KG basin, most recently offering 5.5mn m³/d in the domestic market through a tender on 1 April.
State-controlled upstream firm ONGC has also started selling gas from its deepwater areas in the KG basin. The company expects its KG production to start at 2.5mn-3mn m³/d before ramping up to 3.5mn m³/d in the fiscal year to 31 March 2022 and around 8mn m³/d in the 2022-23 fiscal year.
India's oil ministry has set the ceiling price of gas from deepwater, ultra-deepwater, high-temperature and high-pressure areas at $3.62/mn Btu for April-September, down from $4.06/mn Btu for October-March and $5.61/mn Btu in April-September 2020. Asia spot LNG prices are close to $9/mn Btu, while term LNG rates for Indian buyers are over $9/mn Btu on delivered basis at current crude levels.
Source: Argus