Monetisation of gas from KG basin blocks expected within Q2: DGH official

• Blocks on the east coast of India are going to push the overall gas production post-COVID, said the DGH official

• The official also said that the DGH will try to unlock the production from blocks awarded under OALP bid round 5 at the earliest

New Delhi: A top official at DGH (Directorate General of Hydrocarbons) has said that monetisation of gas produced from KG basin's KG-DWN-98/2 and KG-DWN-98/3 is expected within the Q2 of FY2020-21. While speaking at a webinar on the "Future of gas-based economy in post-COVID times," Dr Anand Gupta, Additional Director General (Development) at DGH, sounded optimistic that the two blocks on the east coast of India will contribute substantially to the overall gas production for the financial year. He pegged the gas output projection for the entire year at 55 BCM.

"The two blocks have been progressing well and gas monetisation at KG-DWN-98/2 and KG-DWN-98/3 is expected to happen within this quarter. Blocks on the east coast of India are going to push the overall gas production post-COVID," Dr Gupta said. While KG-DWN-98/2 is operated by ONGC, KG-DWN-98/3 is operated by Reliance Industries Limited. 

'DGH will try to unlock production from OALP Round 5 at the earliest'

Commenting on the oil and gas blocks awarded recently by the DGH under OALP bid round 5, the DGH top official said that the upstream oil and gas regulator will try to unlock the production from these blocks at the earliest. "There are a large number of discovered, unmonetised fields… around 110 to be precise. Going forward, we will also try to put them on production," added Dr Gupta. 

On being asked about the tepid response received from the private sector in the last two rounds of bidding under OALP, Dr Gupta said that the DGH is holding consultations with stakeholders and reviewing the contract conditions and will resolve the issue soon. 

The backdrop

The Round 5 bid under OALP had received bids from only 12 entities for the 11 areas on offer and all the bids, barring one, had come from state-run OIL (Oil India Limited) and ONGC (Oil & Natural Gas Corporation). In Round 4 of OALP as well, no private player had bid for the the seven blocks on offer and all the blocks were awarded to ONGC.

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