GSPC has informed the director general of hydrocarbons (DGH), an upstream advisory and technical regulatory body, about the new gas find last week. GSPC managing director D.J. Pandian couldn’t be reached for comment.
The natural gas from KG basin is important for GSPC as it is forced to buy natural gas for its customers from liquefied natural gas (LNG) market at a price of $12-14 (Rs473-552) per million British thermal unit (mBtu) equivalent.
Its existing gas source at Hazira is depleting and GSPC requires its own natural gas source to keep its customer base and grow.
It (GSPC) had announced its biggest ever discovery of 20 trillion cubic feet (tcf) of natural gas from this field at the Deendayal block in mid-2005 but DGH had officially put the reserves figure at 3.6tcf—less than 20% of what GSPC had claimed. Instead of challenging the claim, DGH had asked the corporation to drill more wells to prove its claim of the field having 20 tcf of natural gas.
“Striking gas in these two wells would help GSPC prove its claim of higher quantity of natural gas in this field, which it was struggling to do for long,” said a ministry of petroleum and natural gas official who also didn’t want to be named.
GGR has a 5% carried interest in the KG/Deendayal offshore block. GSPC holds 80% of equity in the Deendayal block with 10% held by Jubilant Enpro Ltd, which is part of the Jubilant Corp. (Members of the family that owns Jubilant also have a significant stake in HT Media Ltd, the publisher of Mint where this article came from.)
Disclaimer: I purchased GGR for my newsletter portfolio between $0.94 and $2.25 in 2004 and I have shares purchased as low as 12¢ in my personal portfolio I took quite a bit of profits all the way into the mid teens. I have huge profits in this already. I have been trading the volatility around this core position to generate more gains and may buy or sell at any time. This is a HIGHLY SPECULATIVE stock with no income.
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