Reliance To Commence Gas Production From MJ Field This Quarter

Reliance Industries to start operating the MJ field in the eastern offshore Krishna Godavari D6 block.

In the first quarter of this year, the KG-D6 block, located off the coast of Andhra Pradesh and India's sole deepwater production site, yielded significant natural gas production from its deepest discovery. This accounted for 15% of India's total gas demand. According to the company's investor presentation on its earnings for the March quarter, the block's production averaged 20 million standard cubic meters per day during the January-March period.

Reliance, in collaboration with BP, the UK's supermajor, is approaching the commencement of production from their colossal MJ deep-water project, poised to substantially amplify gas output from their coveted asset on the east coast.

"MJ field is expected to commence production in 1Q FY24 (April 2023 to March 2024)," it said.

Initially, the company, which holds the operational authority for the block, had intended to commence production in the last quarter of December. However, it was delayed by three months.

Reliance and BP are investing a total of USD 5 billion in three distinct projects to enhance the development of KG-D6, an offshore asset, with the goal of revitalizing gas production. The initial two projects, R-cluster and Satellite Cluster, have already commenced gas production, while MJ is nearing its completion. Once MJ becomes operational, it is expected to boost KG-D6 gas production to 30 million metric standard cubic meters per day (mmscmd) by FY24, as stated in Reliance's presentation.

"Testing and commissioning underway in the MJ field," it said. "One well opened as part of the ongoing testing of the integrated production system." The company has successfully supplied 6 million metric standard cubic meters per day (mmscmd) of gas to businesses operating in the city gas, power, and fertiliser sectors. In order to tap into the deepest gas discovery in the KG-D6 block, the two partners have strategized to utilize a floating production system positioned in the high-seas of the Bay of Bengal.

The MJ-1 gas discovery lies approximately 2,000 meters below the Dhirubhai-1 and 3 (D1 and D3) fields, which are the initial and largest fields in the KG-D6 block. MJ-1 is projected to have a minimum of 0.988 trillion cubic feet of contingent resources.The offshore area is also rich in oil reserves.

The FPSO, constructed by Samsung Heavy Industries in South Korea, is designed with a double-hulled structure capable of processing 60,000 barrels per day (bpd) of liquids and approximately 12.7 million cubic meters per day of gas.

The MJ field is anticipated to have a peak output of 12 mmscmd. Reliance, a conglomerate spanning the oil and telecom industries, has made a total of 19 gas discoveries in the KG-D6 block, with D-1 and D-3 being the largest among them, starting production in April 2009.

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