Also, Edelweiss has estimated that the cost of deep-water rigs has halved since 2014.The plan announced by RIL chairman Mukesh Ambani and BP CEO Bob Dudley will help monetise promising fields in the KG Basin , which has been mired in controversies and disputes. The development of the first fields of RIL’s block also came at a time when crude oil prices had rocketed to nearly $150 per barrel. This had prompted companies around the world to drill in the deep sea, making equipment and services very costly.Analysts said several favourable policy changes have also improved the overall investment climate for the sector. It also submitted to the Directorate General of Hydrocarbons, the upstream regulator, proposals for declaration of commerciality of some of the discoveries affected by the new policy. In February this year, Reliance awarded engineering firm Genesis a contract to undertake the frontend engineering design (FEED) for its MJ field in the KG block.

Source: Economic Times June 16, 2017 19:30 UTC