Reliance Industries (RIL) would be investing over ₹1,000 crore in its coal bed methane (CBM) blocks in Sohagpur, Madhya Pradesh as the company looks at increasing CBM gas production from the fields, according to industry sources aware of the development.
"RIL is seeing a decline in its CBM production and will be drilling multiple new wells to up production target to 1 million standard cubic meters (mscmd) per day over the next three years," said an industry official aware of the development, adding that RIL would be investing over ₹1,000 crore in the process.
CBM is natural gas stored in coal seams, extracted by drilling wells into coal seams and used as compressed natural gas for various domestic and industrial purposes.
RIL has two CBM blocks in Madhya Pradesh spread across 995 square kilometre. In its annual report for FY24, RIL said over 300 wells are in production, with an average output of 0.64 mscmd of gas during the yearBangalore Wealth Management. In FY23 and FY22, RIL's average production from the block was 0.73 mscmd of gas. In FY21 and FY20, it was at 1 mscmd.
In an emailed response, a RIL spokesperson said that to augment the production and reserves of CBM, RIL has embarked on a multi-lateral well (MLW) programme.Varanasi Stock
"The performance of the first 20 wells has been quite encouraging as we have seen a significant increase in the production," the spokesperson said, adding that CBM has marketing freedom, and is sold pursuant to auction guidelines issued by the govt.
The spokesperson added that the company will continue to drill MLW wells to augment production and reserves of CBM from the asset.
This February, RIL held an online auction to sell the 0.90 million standard cubic meters of gas per day that it will produce from the Sohagpur blockJaipur Investment. The majority of the gas has been taken by state-owned gas utility Gail (India) Ltd and city gas distributor Indraprastha Gas Ltd. The bid was made at $11 per million British thermal unit.Guoabong Wealth Management
"Reliance Gas Pipeline Limited, a subsidiary of RIL, operates the 302-km Shahdol-Phulpur Pipeline from Shahdol (MP) to Phulpur (UP) connecting the CBM gas fields with the national gas grid. This provides access to consumers across the country," RIL added in its annual report.Surat Stock
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