Reliance Industries' $1.52 bn investment in KG-D6 block rejected

Reliance Industries' $1.529 billion investment plan to develop satellite fields to offset fall in gas output at its KG-D6 block was rejected by India’s Oil Ministry and Director General Hydrocarbons on Friday.

The authorities said that RIL and its partners, BP and Niko Resources, need to rework financials as the original proposal was submitted in 2009 and changed prices of energy and services have to be kept in mind.

RIL request for approval of USD 30 million spending to do engineering studies so that a new field development plan can be submitted was also rejected.

BP, which bought 30 per cent stake in KG-D6 and 22 other blocks of RIL for USD 7.2 billion has been banking on developing satellite fields to reverse the fall in output at KG-D6 field which has dipped to 41 million standard cubic meters per day from 61.5 mmscmd achieved in March last year.