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Current Affairs

Gas production in KGD6

Date: 20 December 2020 Tags: Infrastructure

Issue

Reliance Industries Ltd and BP (British Petroleum) have announced the start of gas production from the R cluster, the deepest off-shore gas field in Asia. 

 

Background

The field is the first of three deepwater gas projects in the KGD6 block jointly developed by RIL and BP to come onstream.

 

Details

  • The R cluster in the Krishna Godavari Basin are expected to produce around 30 Million standard cubic metres per day of natural gas or about 15% of India’s projected demand for natural gas by 2023.

  • The R cluster field alone is expected to have a peak production of 12.9 MMSCMSD or about 10% of India’s current natural gas output.

Importance

  • Increased domestic production of natural gas is an important aspect in reducing India’s dependence on imports and improve energy security.

  • The projects are a key part of the plan to boost domestic production of natural gas to increase the share of natural gas in India’s energy basket from 6.2% now to 15% by 2030.

  • India had estimated crude oil reserves of 618.95 million tonnes (MT), increasing by 4.1% from the previous year.

  • The largest reserves are found in the Western Offshore (Mumbai High, Krishna-Godavari Basin) (40%), and Assam (27%).

Reserves map on East coast

 

Reserves map on East coast

Changes to gas tariff system

  • Recent changes in the formula for gas transport tariffs are likely to benefit Reliance and BP’s investments in these three fields.

  • The new system  charges consumers based on the distance from the source of gas and the number of pipelines used to a unified gas tariff system through with one tariff for gas transported within 300 kms and another tariff for gas transported beyond 300 kms from the source of the natural gas.