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Regulation
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Market Watch
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Press Release [FREE Access]
Petro Intelligence » Why And How Bastia Got Busted

Mukesh AmbaniRabi Narayan Bastia, head of exploration at Reliance Industries Ltd (RIL), has quit the company without assigning any reason.

The sudden resignation has sent a buzz of speculation through the small cloister of petroleum industry mavens because Bastia is the geologist who has been credited with identifying the 'huge' potential reserves of the D6 field in the Krishna Godavari basin.

The obvious question: did his resignation have anything to do with the recent troubles that have enveloped the field just over a year ago after gas output started to dip to alarming levels?

Rabi BastiaBastia is a distinguished geologist with an impressive track record. He holds a PhD in structural geology from IIT Kharagpur and is a pretty well-known figure in the world’s geo-scientific academia.

D6 was billed as the biggest gas discovery in the world in 2002. It was projected to produce 80 mmscmd of gas in 2011-12. When production soared to 60 mmscmd in July 2009, it was a rah-rah moment for Reliance – and it was reckoned to be well on course to attain a peak production of 80 mmscmd. But things started to go wrong soon after and gas production plummeted. Output is now slated to fall to 20 mmscmd in 2014-15.

P.M.S PrasadIn short, KG-D6 has all the makings of a colossal disaster. A couple of months ago we irreverently compared the disaster in the Bay of Bengal with John F. Kennedy’s notorious Bay of Pigs disaster. We didn’t know then the magnitude of the disaster and were unaware that what we had said in jest had a sickening ring of truth.

A number of reasons have been attributed for the KG-D6 debacle (click column policy to read D6 Imbroglio: Take The Nation Into Confidence). We started our investigation into the D6 catastrophe sometime ago and our report quoted BP – which was roped in as RIL’s strategic partner last year – as saying that the D1, D3 fields did not hold the sort of prospects that it was touted to possess.

We delved a little deeper and we now have a fair idea of what went wrong. But we do not consider ourselves competent to sit in judgment on the issue and would not like to indulge in loose prattle. We are just doing our professional duty of probing an issue that is of tremendous national importance.

V.K SibalOur inquiries reveal that as chief of exploration, Bastia will have to own up responsibility for the D6 disaster. Bastia cannot be blamed for either the complexities or unpredictability of the KG basin. That is Nature’s creation. The question is: did Bastia go wrong in evaluating the reserves of the D6 block?

Experts acknowledge that the definitions of reserves and associated guidelines cannot address all possible scenarios. Nor can they remove the conditions of uncertainty that are inherent in all reserves estimates. It is the responsibility of the reserves evaluator to exercise sound professional judgement and apply these guidelines appropriately and objectively.

Shashi MukundanBastia does not seem to have done that. He is considered a genuine professional incapable of perpetuating such a fraud. The question is: Where did he falter?

It appears that some geological parameters that determine how much hydrocarbons the sub-surface holds have only been studied over a small area and the data has been extrapolated to cover the entire area. The study was confined to a pilot area. The assumption was that the same geological parameters would exist in the rest of the field, which was not true. Why was this extrapolation permitted?

US multinationals sell mathematical modelling software that just takes data from one well and applies it to a vast area based purely on statistical theory rather than predicated on the actual geology of the area.

Using data drawn from just a few wells, the software can draw up a model showing the rock formations that lie deep below even though the facts may not corroborate the theoretical model. The well log data itself is an indirect measurement of geological parameters that decide the accumulation of hydrocarbons.

 For example, there is the Gamma Ray measurement which is determined by using a probe. If the gamma ray is lower, it is assumed that the rocks such as limestone and sand stone exist which are likely candidates for holding hydrocarbons. The process called inversion is to use all these indirect parameters to recreate what the Earth looks like deep below and where it holds eagerly sought hydrocarbons. The modelling based on mathematical software is designed to trim costs and cut the time to determine reserves for exploration. But the downside risk is that the compulsions of time and money can result in blunders.

But not many are aware of what the software actually does and for convenience-sake rely on it which results in blunders like D6.

The Russian petrophysicists are aware of the pitfalls of the software and, hence, do not use it to draw a model of the sub surface. Not many geoscientists know how these mathematical tools work. For example, wrong conclusions can be drawn by certain log indirect measurements which overestimate the pore volumes and lead to bloated reserves.

Rabi Bastia appears to have relied too much on these western mathematical software. There is understood to be a massive variance in the reserve estimates in D6 now that the model has been rebuilt on the basis of actual observed parameters.

 



To download the latest issue 'Volume 26 Issue 7 - July 10, 2019', click here
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Energy Transition: Implications For India
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Assessment Methodology for Hydrocarbon Resource of Indian Sedimentary Basins
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