India's GSPC in Talks with ONGC to Sell Stake in Offshore KG Basin Gas Block

The Gujarat State Petroleum Corp (GSPC) is in discussion with Oil and Natural Gas Corp (ONGC) to sell stake in a gas block in offshore India's east coast.

The Gujarat state owned GSPC has already invested around $3.6 billion in exploring and building infrastructure around the block but with little success, and now wants ONGC's help on funds and drilling expertise, news agency Reuters reported Monday. Gas was discovered in the block way back in 2005 and production was expected to commence in 2011.

GSPC says it now hopes to start commercial production later this year, with an initial output of 70-80 million cubic feet a day (mcfd).

"Commercial production is expected to start after the drilling, hydraulic fracturing and completion of the fifth development well (D5), tentatively by the end of October," GSPC told Reuters.

GSPC had managed to extract around 23 mcfd since August 2014 from three wells it drilled using conventional drilling methods.