ONGC's Gas Discovery in KG Basin Disallowed by DGH

Krishna-Godavari Basin
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The Directorate General of Hydrocarbons (DGH) has disallowed Oil and Natural Gas Corporation's (ONGC) recent gas discovery in the Krishna-Godavari Basin. ONGC's exploration team had last year struck natural gas in ultra-deepwater well UD1 in the Krishna-Godavari block KG-DWN-98/2.

The Director General of Hydrocarbons, Mr V.K. Sibal, said the organization had disallowed the discovery, since the gas was not flowing to the surface. The production sharing contract (PSC) does not agree to considering something as a discovery if it does not flow to the surface.

ONGC is likely to contest the DGH's view.

An official said the company carries out its activities in the New Exploration Licensing Policy (NELP) blocks as per laid down PSC norms. In adherence to the norms, in the well UD-1, block KG-DWN-98/2, ONGC notified DGH regarding modular dynamic test (MDT) in the interval 5,243.5 - 5,304 m, which was conducted in the presence of DGH representative during December 7-15, 2006. The interpreted presence of hydrocarbon was validated through this test.

After further completion of further tests the discovery of Non-Associated Natural Gas (NANG) was brought to the notice of DGH on December 23, the official said. ONGC, in consultation with its partner Cairn Energy India Ltd, submitted its potential commercial interest, meriting appraisal, in the prescribed format to the DGH. The hydrocarbon in-place estimated as per standard practice is in a range of 2.09 TCF-14.76 TCF.

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