RIL EXITS MYANMAR OIL & GAS BLOCKS
Reliance Industries (RIL) has exited its last overseas conventional oil and gas assets by relinquishing two blocks in Myanmar. The company still holds its interest in two shale gas assets in the US. The company, in an investor presentation after the September quarter results, said the blocks M17 and M18 in Myanmar were relinquished following a study and a technical evaluation. RIL had a 96 per cent stake each in the two blocks, which was awarded to the company in 2015.
Mukesh Ambani-led Reliance Industries Ltd (RIL) has exited its last overseas conventional oil and gas assets by relinquishing two blocks in Myanmar. The company still holds its interest in two shale gas asset in the US.
In an investor presentation after the July-September period results, the company said that on completion of a study and technical evaluation, blocks M17 and M18 in Myanmar were relinquished. RIL had 96 per cent stake each in the two blocks, which was awarded to the company in 2015. Earlier this month, the company had sold its stake in one of its three shale gas blocks in the US, at Marcellus Shale asset where it had a joint venture with Carrizo Oil & Gas, for $126 million.
Though the Mumbai-based company has invested $9 billion in the US assets, it was getting negative returns owing to lower crude oil prices. Now, RIL holds 45 per cent stake with Pioneer Natural Resources in the Eagle Ford shale asset and 40 per cent with Chevron at Marcellus shale. “RIL signed agreements to divest all of its interest in the upstream shale gas assets operated by Carrizo. Transaction is expected to close by the end of the third quarter of FY18,” the presentation said. The company had marked its presence in countries like Yemen, Peru, Oman, Myanmar, Columbia, East Timor, Kurdistan and Australia by acquiring conventional oil and gas assets over the past 10 years through its subsidiary Reliance Exploration and Production (REP). However, it exited almost all these blocks later as part of its portfolio rationalisation due to low viability. From having almost 16 assets abroad, the company is left with no conventional blocks following the Myanmar relinquishment.
In India, RIL holds stakes in the Krishna-Godawari basin, Mahanadi basin, Saurashtra basin and Panna/Mukta and Tapti fields. During financial year 2016-17, RIL’s revenues for the domestic oil and gas operations declined by 34.6 per cent to ~2,787 crore, on account of a 23 per cent decline in production and reduced gas price realisation.
In June, Ambani and BP Plc Chief Executive Bob Dudley had announced investments worth ~40,000 crore on three discoveries in the eastern offshore KG basin, which is expected to increase the gas output by 30-35 million standard cubic metre per day (mscmd).
The output from KG-D6 has now dropped to about 6 mscmd, from 54 mscmd in 2010.