"Currently the fifth well is being drilled in the Krishna Godavari basin. We have found oil in it at 2,500 metres," Managing Director D J Pandian said.
The company had first discovered oil in its Deen Dayal block in the Krishna Godavari basin in June with a flow rate of 862 barrels a day.
Pandian said there were indications of natural gas in the fifth well and the company was evaluating its estimated oil reserves and commercial viability.
He said Gujarat State Petroleum had committed to drill 30 more wells in the block, where it had announced a 20 trillion cubic feet gas find last year.
The explorer plans to invest 17 billion rupees ($368 million) in further exploration of the shallow water block.
The company is planning an initial public offering by December to raise funds for development of the block and by selling part of its 80 percent interest to a partner.
Canada's Geoglobal Resources Inc and local firm Jubilant Enpro are the other minority stakeholders in the block.
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