Reliance Industries and its partner BP Plc of the UK have pushed back the start of production from the second wave of discoveries in their eastern offshore KG-D6 block to June-end because of the restrictions on movement of people and material the nationwide lockdown has imposed.

At the current Brent oil price of around $26 per barrel, the gas from R-Series field in KG-D6 block will cost about $2.2 per million British thermal unit — lower than even the government mandated rate of $2.39 for gas from state-owned ONGC fields.

In an investor presentation post its fourth-quarter earnings, Reliance said it is working on three projects in the KG-D6 block, where production from older fields stopped in February this year. “First gas from the R-Cluster field expected by June 2020 subject to lifting of lockdown,” it said. Gas production from the R-Cluster was to start by mid-May but the coronavirus lockdown has delayed it.

Reliance said it expects to achieve a peak output of around 28 million standard cubic metres per day (mmscmd) by 2023-24 when all the three projects are up and running.

Reliance and BP are developing three sets of discoveries in KG-D6 block — R-Cluster, Satellites and MJ by 2022.

R-Cluster will have a peak output of 12 mmscmd, while Satellites, which are supposed to begin output from mid-2021, would produce a maximum of 7 mmscmd.

In November last year, RIL auctioned the first set of 5 mmscmd of gas from the newer discoveries in the KG-D6 block by asking bidders to quote a price (expressed as a percentage of the dated Brent crude oil rate), supply period and the volume of gas required.

Sources said Reliance had in November set a floor or minimum quote of 8.4 per cent of dated Brent price — which meant that bidders had to quote 8.4 per cent or a higher percentage for seeking gas supplies. Considering the current average Brent price of $26 per barrel, the gas will cost around $2.2 per mmBtu.