EVEN as the Mukesh Ambani-controlled Reliance Industries production at its flagship KG-D6 Basin remains well below estimates, the company has won two offshore blocks in Myanmar, for which it will enter into production-sharing contracts (PSC).
According to Reuters, Myanmar has awarded 10 shallow-water blocks and 10 deepwater blocks in an auction process that began last April, according to a posting on the ministry’s website on Wednesday. The country’s proven natural gas reserves totalled 7.8 trillion cubic feet (tcf) at the end of 2012, according to BP’s Statistical Review of World Energy.
Meanwhile, although the government has notified the Rangarajan formula, going by which the price of gas would nearly double from the current levels of $4.2 per mmBtu, the Election Commission (EC) has deferred the price rise which was to take effect on April 1. BJP leader Arun Jaitley, meanwhile, said that were his party to come to power, it too would re-look the price hike in gas.
RIL has already invested $6.5 billion in shale blocks in US and earnings from these have overtaken those from the firm’s Indian E&P operations, in which $23 billion has been invested including the interest on the capital.
In Q2FY14, RIL earned Rs 1,200 crore of revenues and Rs 787 crore of ebitda from its US operations. In contrast, Indian E&P revenues were Rs 1,464 crore while ebitda was Rs 760 crore – these are based on analyst estimates. Analysts expect RIL to be cash-positive on US shale in a few more quarters. Other than the latest foray to Myanmar, the company is focussed on Venezuela and Iraq. While at one point RIL was working on 45 blocks in India, this is now down to six blocks.