Reliance hits bull's eye in Cauvery basin

NEW DELHI: RIL’s success story on oil and gas finds may have just got bigger. The energy major is now set to announce its next big find of gas, this time in the Cauvery basin. The company, which had acquired the block under the third round of exploration bidding, has sent the discovery notice on the find to the directorate general of hydrocarbons (DGH).

A source close to the development said, “The drilling in these blocks have thrown up some interesting results. Hydrocarbon bearing structures have been found in the block, which is likely to be predominantly gas bearing.” Some oil traces have been found as well. An official in the DGH confirmed the development.

“The company has informed us on Monday that it has found hydrocarbon in the Cauvery basin,” an official said. He, however, added that as per the norms, the operator has sent a letter to the DGH stating that hydrocarbon has flown to the surface of one of the wells drilled in the Cauvery basin block (CY-DWN-2001/2).

The quantity of oil and gas is yet to be ascertained and it is too early to establish the commerciality of the find. The process of appraisal of the well would be undertaken first, thereafter commerciality would be established.

RIL’s gas find comes barely a year before its giant fields in the Krishna-Godavari region goes into production. The company is awaiting government approval for determining the price at which it would sell the gas to the consumers. The company had started drilling two wells in the block recently and the drilling activity in one of the wells has been completed. It is understood that testing phase of the well has been completed. RIL deployed two rigs in the block to search for hydrocarbon. The area of the block is 14,325 sq km.

The operator of the block, Reliance, currently holds 100% stake in the property. Initially it held 90% participating interest, while the balance 10% was held by Hardy Exploration & Production (India). Later, Hardy sold its stake to RIL.

The Cauvery basin is located in between the Southeastern coast of India and Northeastern coast of Sri Lanka. It is spread over 55,000 sq km (25,000 sq km onland and 30,000 sq km offshore). The basin has several small oil discoveries, both offshore and onshore. The first oil production in the basin was started in an onshore block in 1986.