Shah panel to submit report on ONGC-RIL gas dispute today

A P Shah committee, which was looking into the dispute over transportation of natural gas from ONGCKG base’s blocks in KG basin to the neighbouring fields of Reliance Industries Ltd (RIL), is set to submit its final report on Wednesday.

“The report will be submitted to the concerned joint secretary (exploration), Amar Nath, by 2 p.m. on Wednesday. The ministry will examine the recommendations of the panel and will take a decision later,” said a petroleum ministry official.

The one-man panel had got an extension of one month on July 31, after it failed to meet the deadline. Shah panel was set up December 2015.

Earlier also, in March, as RIL and its partner Niko Resources of Canada joined the enquiry committee in February and submitting their version. The committee was set up last year after the US-based consultant DeGolyer and MacNaughton (D&M) stated in its report that about 11.122 billion cubic meters of natural gas worth about Rs 11,000 crore had been transported to the RIL fields from ONGC’s idle fields.

Initially, RIL and its partner Niko had questioned the constitution of the panel and stayed away from participating in its proceedings, though UK-based BP Plc participated in it. Later, both the companies changed their decision and participated with the enquiry of the panel.

According to D&M report, which was submitted last year, reservoirs in ONGC’s Krishna Godavari basin KG-DWN-98/2 (KG-D5) and the Godavari-PML are connected with Dhirubhai-1 and 3 (D1 & D3) field located in the KG-DWN-98/3 (KG-D6) Block of RIL.

The report adds that out of the 58.68 bcm of gas produced from KG-D6 block since April 1, 2009, 8.981 bcm could have been transported from ONGC fields. At a gas price of $4.2 per million metric British thermal unit, about Rs 11,055 crore-worth of gas comes from ONGC’s side.

It was in 2013 that ONGC claimed that RIL intentionally drilled wells close to its blocks, through which gas transported. D&M was appointed by both RIL and ONGC to study on the issue.

According to D&M estimates, RIL’s D1 and D3 field had 80.697 bcm reserves in place, while state-run ONGC’s Godavari-PML had 14.209 bcm of reserves and KG-D5 another 11.856 bcm.

However, the remaining gas in ONGC field is not considered to be economically viable. The mandate of the panel was to quantify the amount of gas, which migrated from ONGC field and also recommend actions to be taken based on that.

It was also set to look into any acts of “omissions and commission” committed by any of the stakeholders.

Oil and Natural Gas Corporation Limited (ONGC)

Reliance Industries Limited (RIL)