Reliance's 2Q FY16 Oil, Gas E&P Revenue Falls 31.1% to $309M

India's Reliance Industries Ltd. posted a second quarter 2016 (2Q FY 2016) revenue of $309.03 million (INR  20.067 billion) for its oil and gas exploration and production (E&P) business, a 31.1 percent decline from $462.31 million (INR 30.02 billion) last year amid a 50.6 percent fall in global benchmark Brent crude oil prices, the firm reported Friday in its release of financial results for the second quarter of 2016 (2Q FY 16) ending Sept. 30.

The company's revenues for its domestic E&P operations in 2Q FY16 shrank 15.5 percent to $179.56 million (INR 11.66 billion), compared to $212.52 million (INR 13.8 billion) a year ago due to lower oil/condensate prices and a decline in gas production from KG-D6 block.

Over at the KG-D6 field, production reached 0.39 million barrels (MMbbls) of crude oil and 37 billion cubic feet (Bcf) of natural gas during the quarter, down 24 percent and 9 percent, respectively from a year ago, while condensate production was at 0.8 MMbbls. Reliance attributed the decline in oil and gas production largely to the natural decline in the fields.

Meantime, the firm is conducting studies to identify options to augment production from the MA field, while the B7 and A1 wells have been successfully put into operations in July resulting in a combined production of around 1 million standard cubic feet per day (MMscf/d) of gas. In other development, drill stem testing (DST) operations in D29 and D30 discovery wells have been completed.

Turning to the Panna-Mukti and Tapti fields, the company produced 1.88 MMbbls of crude oil and 17.2 Bcf of natural gas in 2Q FY16, up 7 percent and 5 percent, respectively from last year. Production rose due to gains from workover wells and a resumption of production from the Mukta-A platform despite decline caused by maturing fields.

Output from the Tapti fields were 0.03 MMbbls of condensate and 0.6 Bcf of natual gas, representing a fall of 52 percent and 85 percent compared to the previous year. Reliance indicated that installation and commissioning of Mukta-B facilities completed in 1Q FY16. "Out of six wells planned, drilling of four wells have been completed and put into production. Drilling of remaining two wells is in progress and likely to be completed by end of 3Q FY16," the company said in the press release, adding that the Tapti field is expected to cease production in the same quarter.

Elsewhere, Reliance has commenced DST operations for the D32 discovery in October, while preparation and discussion with its partner is underway for a field development plan (FDP) for eight discoveries in the CB-10 Block. The FDP is scheduled to to be submitted to the Reliance's Management Committe by the end of 3Q FY16.


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