The directrate general of hydrocabons has approved  ONGC appraisal plan for the gas discoveries in deep-sea block KG-DWN-98/2.

ONGC will dig six appraisal wells to assess potential of the discoveries. The company will invest $5.3 billion in developing gas finds in two of its eastern offshore Krishna Godavari basin blocks to produce 25 million standard cubic meters per day of gas. This investment will be done over the next five years by 2013.
 
An appraisal programme helps the exploration companies in establishing the commerciality of the discovery. After establishing the commerciality comes the development of the field. Exploration companies after finding hydrocarbons submit an appraisal plan to the management committee of the block. Subsequent to the nod, the companies go in for an appraisal programme.

The block is adjacent to Reliance Industries' KG-DWN-98/3 or D6 block. ONGC plans to tie up 10 discoveries in KG-DWN-98/2 with the G-29, GS-4 and Vashistha gas finds in a shallow water block KG-OS-DW4 in the same basin.

Besides natural gas, ONGC also plans to produce 8,000 barrels of oil per day from the fields. The reserve estimates and production plan in ONGC's appraisal programme, however, excludes ultra-deepwater UD-1 discovery in KG-DWN-98/2 block.

The UD-1 discovery alone has been certified by DGH to hold just over 2 Trillion cubic feet of inplace gas reserves.

Ten discoveries in KG-DWN-98/2 (excluding UD-1) and three in adjacent block together hold 6.37 Tcf of inplace reserves.

Without UD-1, the block is assessed to hold just over 5 Tcf of inplace gas reserves.

ONGC initially held 90 per cent in the block, with Cairn India owning the remaining 10 per cent. It then diluted its stake to 65 per cent in favour of Brazil's Petrobras by 15 per cent, Norway's StatoilHydro 10 per cent to exploit their deepwater  expertise.

ONGC Videsh Ltd (OVL), the overseas arm of Oil and Natural Gas Corporation, is on verge of picking up to 40 per cent stake in Kazakhstan's Satpayev oil field in the Caspian Sea.
Petroleum Secretary has said that an OVL team had gone to Kazakhstan to finalise the deal.

An agreement on the stake sale was expected to be signed during the visit of Kazakhstan President Nursultan Nazarbayev to India.

OVL, which has paid $2.1 billion for taking over Imperial Energy, would also invest another $600 million over the next two to three years to develop the company's assets in Russia.