India has

Never been
here before
FACTS YOU DIDNT KNOW ABOUT KG-D6

S E R I E S

India has
Never been
here before
FACTS YOU DIDNT KNOW ABOUT KG-D6

Introduction
Deep water exploration for oil and gas is a
complex science and a risky business. It involves
technology and extreme engineering of the kind that
India has not seen before. It requires staggering
amounts of risk capital. Exploration success rate is as
low as one in ten and reservoir surprises can occur at
any stage of development and production.
People without even a fleeting understanding
of the sector have touched off a debate over the
KG-D6 block to suggest that Reliance Industries is
making windfall profits. This compilation is an
attempt to inform the debate with facts so that
rhetoric and illogic dont drown out the serious issue
of Indias energy security.

S E R I E S

Temple of modern India.

engineering marvel
S K Srivastava, Director General, DGH, Dec 8, 2012

The D1-D3 fields in the KG-D6 block operated by

Reliance Industries is amongst the fastest greenfield
deep water oil and gas development project in

the

world from notification of discovery to first

production. It was an extreme engineering project of
the nature that India has never seen before. The gas
reservoir was at least 50 km into the high seas, one
km below the surface and two km below sea the
bed. It used 110,000 million tonnes of subsea
equipment, 60 km of subsea pipelines--the longest ever
built in Indiaand 2500 line-km of pipelines and 80
installation vessels. Design and construction
innovations were used to redefine internationally

DHIRUBHAI-1: The Floating

Production, Storage & Offloading
(FPSO) facility with capability of oil
and gas processing, oil and
condensate storage, offshore
offloading and gas evacuation to the
onshore terminal.

accepted timelines for such projects. RIL took just

six and a half years to start production (from the

date of discovery) against the world average of ten
years. It put India on the global map of extreme
engineering attracting approbation from industry
peers, domestic and international.

250

200

150

100

Upstream Capital cost index (IHS-CERA)

300

FLAME

FACTS
Its easy to throw
numbers to hide facts,
such as the alleged
`54,000 profit per year
to RIL. Some
real figures.

RIL is India's

and thus far only,

first,

deep water gas

producer
No other company, public
or private, has started
production 14 years after

first NELP auctions.

75%

Domestic gas
produced by PSUs.
RIL's share is only

15 percent.

2.32 trillion
cubic feet.

Gas
produced
by RIL

2009.

since

` 16,000crore.

ONGC's
revenue increase
due to

gas price hike.

RIL only

` 2,400 crore.

$ 33

billion.
The foreign reserves

saved in import
substitution.
` 54,000crore.

The alleged

profit for

RIL is an

windfall

absurd

miscalculation
floated deliberately to

distort gas pricing discourse.

`1,20,000 crore.

100% Every cubic feet

if gas production not

made viable,

gas produced under

Loss to the nation

increasing import
dependence.

$16*Price RIL pays

for importing LNG.
$4.2 MMBtu, price
KG-D6

it sells
gas
for! Govt determines the
end user of KG-D6 gas.

*Price can vary from time to time

**Till Dec. 2013

2.279

**
of the
trillion cubic feet of
NELP is from RIL.

No other producer
in 14 years of NELP.

$ 400 billion.
Worth of

27 TCF of

discovered gas

awaiting investments
for development and

production. Critical for

India's energy security.

09

The Illogic Of Cost As Profit!

S E R I E S

The off-loading hose on

reel under the heli-deck.
This hose is used to
transfer oil to cargo ships.
It has adequate buoyancy
to avoid submergence
even if full of oil.

31

Birds eye view of the

helideck, pipe deck and
accommodation from
the Derrick.

Pacific North West

Sinopec+ | 6.5bcm

Turkmenistan
PetroChina | 60bcm

Kazakhstan
PetroChina | 10bcm

A1-A3
PetroChina | 4.1bcm

NWS LNG
CNOOC | 4.5bcm

BG Portfolio
CNOOC | 6.8bcm

Graphic By: Team Reliance

Yemen LNG
CNOOC | 4.9bcm

Qatargas LNG
CNOOC/PetroChina | 6.8bcm

Uzbekistan
PetroChina | 10bcm

Russia
CNPC | 38bcm

Yamal LNG
CNPC | 4.1bcm

MLNG Dua/Tiga
CNOOC | 4.1bcm

Tangguh LNG
CNOOC | 3.5bcm

PNG LNG
Sinopec | 2.7bcm

Gorgon LNG
PetroChina | 5.7bcm

AP LNG
Sinopec | 10.3bcm

QC LNG
CNOOC | 4.9bcm

50