BP and Reliance Sanction Second Phase of Integrated KG D6 Development

BP and Reliance Industries Ltd. (RIL) have announced the sanctioning of the ‘Satellite cluster’ project in Block KG D6, moving forward to develop the Block’s discovered deep-water gas fields in an integrated series of projects, bringing new gas production for India.

The ‘Satellite cluster’ is the second of three projects in the Block KG D6 integrated development. The first of the projects, development of the ‘R-Series’ deep-water gas fields, was sanctioned in June 2017. Together, the three projects will develop a total of about 3-tcf (trillion cubic feet) of discovered gas resources with a total investment of Rs. 40,000-crore ($6-bn). They are expected to bring a total ~ 30-35 million cubic metres of gas per day onstream, phased over 2020-2022.

“In consonance with our announcements last year to raise domestic gas production, we are delighted to announce the on-schedule progress of the Satellite cluster in the east coast of India. This development supports the country’s imminent need of increasing domestic gas supply and is a firm step towards making India a gas-based economy,” Mr. Mukesh Ambani, Chairman and Managing Director of RIL, said in a press release.

Speaking in London, Mr. Bob Dudley, BP Group Chief Executive, welcomed the investment decision: “This latest investment is a further demonstration of BP’s commitment to India. Through our partnership, Reliance and BP are able to develop these discovered gas resources efficiently and economically, working closely with the Government of India. These new developments will produce much needed energy for India’s thriving economy.”

Integrated field development of deep-water gas fields

The Satellites cluster is a dry gas development and comprises four discoveries with five well subsea development in ~1,700-m water depth, up to ~15-km east and southeast of the producing D1D3 fields in KG D6.

The first of the KG D6 projects to be sanctioned, the R-series project, is already in execution phase with all major contracts awarded. The Satellites cluster project will draw on execution synergies with the R-series project being developed concurrently. India today consumes over 5 billion cubic feet a day of natural gas and aspires to double gas consumption by 2022. Gas production from the 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.