Defence Ministry clears oil blocks of RIL, others

 Defence Ministry clears oil blocks of RIL, others


NEW DELHI: Ending weeks of stalemate, the Defence Ministry has cleared Reliance Industries' producing KG-D6 block and gas discovery area NEC-26 along with most of the areas where it had either barred any oil and gas activity or put stringent conditions.

In all 8 blocks, including RIL's Krishna Godavari basin KG-D6 block and gas discovery area of NEC-25 in the North East Coast ( 
NEC) region, were declared "No-Go" zones for reasons like overlapping with proposed Naval base or being close to missile launching and Air Force exercise area. Stringent conditions were put for another 32 exploration areas.

At a meeting taken by National Secretary Advisor
Shivshankar Menon and Principal Secretary to Prime Minister Pulok Chatterji on February 27, RILBSE 0.92 % blocks were fully cleared for exploration and production and stringent conditions for most of the 32 other blocks relaxed, sources said.

RIL's KG-D6 was fully cleared for oil and gas activity with the total area of 7,645 square kilometre reduced by 495 sq km to meet defence needs, sources said.

Similarly, its NEC-OSN-97/2, where six gas finds have so far been made, was fully cleared with the "hold harmless" clause for any accidental debris.

RIL's KG-OSN-2001/1 was also cleared but the block had already been relinquished by the operator.

However, state-owned Oil and Natural Gas Corp's (
ONGCBSE 1.02 %) KG basin blocks KG-OSN-2005/1 and KG-OSN-2005/2 and BG Group's KG-DWN-2009/1 would remain No-Go areas as they fall directly within the boundary of the proposed naval base, sources said.

CairnBSE -1.74 % India's KG-OSN-2009/3 and ONGC's KG-OSN-2009/4 blocks while DRDO was willing to clear these with some conditions or with reduction in the area of the latter, there were issues to be resolved with IAF. They fell within IAF's Suryalanka Guided Weapon Firing Range (GWFR).

Sources said it was agreed that the Defence Ministry will re-examine the matter with IAF, considering that there is high probability of finding hydrocarbons in these blocks and finalise in two weeks.

Sources sid of the 32 blocks with stringent conditions, 15 where DRDO clearance was needed, were cleared with some conditions.

17 blocks for which Navy had given conditional clearance earlier have now been cleared by Navy without any conditions. Further, out of the 11 block which were conditionally cleared by IAF earlier, five areas have completely been cleared and one block cleared with a 10 per cent reduction in area. The remaining five blocks have been cleared fully for exploration up to 2016 in portions overlapping with defence facilities.

Ministry of Petroleum & Natural Gas would prepare and submit a note for consideration of the 
Cabinet Committee on Investment within two weeks, they added.

Sources said the change of heart came as Oil Ministry pushed very hard saying KG-D6 block has been producing oil since September 17, 2008 and gas from April 1, 2009 after obtaining all requisite approvals.

For NEC-OSN-97/2 (NEC-25), the Oil Ministry aggressively stated that six discoveries made in the block could not be exploited because of lack of clearance.