Two deepwater exploration wells will be spudded off the east coast of India this year, with the go-ahead for a subsea manifold cluster project hingeing on the results.

Reliance Industries operates the KG-DWN-2003/1 (D3) block in the Krishna Godavari Basin, and recently submitted to the Indian government a revised Declaration of Commerciality proposal for its Dhirubhai 39 and 41 natural gas discoveries. However, DI hears an approval is not likely before the end of the year, while two further wells are drilled – starting with the first in the second quarter of this year.

Partners in the D3 block are Reliance (60%), BP (30%) and Hardy Oil & Gas (10%), and DI understands that although a development via a dry gas subsea manifold cluster is eventually expected to proceed, the Indian government is still scrutinising the resubmitted declaration of commerciality proposal, and pushing the operator to further enhance the commerciality of the project. The Indian authorities’ review is likely to continue throughout 2013, said Hardy in its latest results presentation.

The proposed development via the subsea cluster, with the flexibility to act as a production hub to add in additional zones and possible future discoveries in the adjoining area, has been on the table for some time, and the addition of BP to the consortium mid-2011 added considerable technical momentum to the project. The solution would be similar to the development concept employed by Reliance on its D6 subsea project, also in the KG Basin. The gas would be piped to shore, to a new processing plant.

BP’s farm-in to a range of Reliance’s assets offshore India valued the D3 block at around US $5 Bn.

A tendering process for the subsea equipment may not get underway until late this year or early 2014, but BP does of course already have global subsea production system frame agreements in place with players such as FMC that could encompass the project.

Comprehensive reprocessing of more than 1,292 sq km of 3D data covering the prospective eastern areas (dubbed the Phase-II area) of the block has already been carried out, with a number of prospects and deeper plays high-graded as a result. Interpretation is still continuing, added the UK independent. Up to 15 prospects are understood to have been identified.

A fifth exploration well will be drilled starting in the second quarter of 2013 by Transocean’s Dhirubhai Deepwater KG2 drillship, which is now in Indian waters. A sixth probe – the final commitment well – will be spudded later in the year.

Hardy says that once these new wells have been drilled, the joint venture will compile the collected data, including the previous four gas discoveries (Dhirubhai 39, 41, 44 and 52 (the KGV-D3-A1, B1, R1 and W1 wells), and engineer a “comprehensive development strategy for all proven hydrocarbon accumulations”.

The D3 licence itself covers an area of 3,288 sq km in water depths ranging from 400-2,200 m (1,312-7,218 ft), and lies approximately 45 km offshore. A total of 3,250 sq km of 3D seismic has been shot over the block so far. Gross recoverable reserves are put at about 680 Bcf.

- Hardy and its partners in the nearby D9 licence recently relinquished that block due to poor hydrocarbon potential.