RIL, Cairn India can explore production fields: Veerappa Moily

RIL and Cairn have maintained that exploration being a continuous process is allowed in the mining lease under which they currently produce gas from eastern offshore and Rajasthan blocks respectively.

They felt the 'ring-fencing' proposed by DGH and seconded by the Oil Ministry was not practical and legal.

While RIL has proposed to drill an exploration well on the flagging D1&D3 gas fields in the KG-D6 block to study reservoir characteristic, Cairn wants to drill new probes to help raise output from the Rajasthan block to 300,000 barrels per day (bpd) from 175,000 bpd.

Globally, exploration is permitted in fields that are under production so as to keep adding new reserves to replenish ones that have been produced. In absence of rejuvenation, the fields will terminally decline from the day output starts.

The same has been followed in fields in Assam and Mumbai offshore.

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