Reliance Gas Reserves Lower than Estimated

US consulting firm Degolyer and MacNaughton has assessed the in-place gas reserves at Reliance Industries' deepwater block D6 in Krishna Godavari Basin at 10 trillion cubic feet, lower than the company's claim of 14.5 tcf reserves.

"D&M, which performed an assessment of the reserves on behalf of RIL's partner Niko Resources of Canada, has assigned gross in-place gas reserves of 10 tcf in the KG-DWN-98/3 block (also called D6)," Niko said.

The study said the 10 tcf comprises 3.4 tcf of technically proven reserves, 3 tcf of probable and 3.6 tcf of possible reserves. The 10 tcf reserves as of April 1, 2003, do not include results from the A2 well - the last of the eight wells drilled by RIL in the first phase of exploration - which were under evaluation when the study was being undertaken.

However, operator RIL stands by its earlier assertion that the block's in-place resources are in excess of 14 tcf of gas and says "the numbers would near these levels over time when ongoing analysis is completed."

"We believe the gas reserves in D6, which are equal to 2.3 billion barrels or 300 million tons of oil, are set to produce 2.12 billion cubic feet per day versus combined output of 2.2 Bcfd from all of India's other gas fields," senior RIL officials said.

Reliance Industries holds a 90% stake in the block and Niko Resources holds the remaining 10%.