Reliance Industries ltd (RIl) intends to be bullish on shale gas, which has been a major contributor to its earnings, and will invest up to $700 million in its shale gas venture in the current fiscal. Apart from this the company also plans to ramp up its expenditure under the $13 billion capex programme in the petrochemical and refining business.
“We will invest $600-$700 million in the shale gas venture. This figure has almost become into a yearly run rate now...We hope to open around 125 to 175 new wells during the year,” RIl Chief Financial Officer (CFO) Alok Agarwal has said.
He spoke to media persons after the company shared its financial results for the fourth quarter of 2013-14. The shale gas business grew significantly during the year and has become a material contributor to earnings.
On other capital expenditure plans for FY15, he pointed towards RIl's $13 billion programme on the petrochemical and refining front and noted that 30 per cent of the targeted amount is done and the balance 70 per cent will get invested in the next 18-24 months.
On KG-D6, Agarwal said the Mukesh Ambani-led conglomerate will focus on improving production from the gas block in the current fiscal and maintained that the output grew in the just-concluded fourth quarter.The average daily production moved up by a notch in the fourth quarter as against the earlier quarter, he said.
Asked about the imbroglio over the gas supply agreements, Agarwal declined to say anything specific but asserted the company will focus on safeguarding its interests. Without giving a timeline for the launch of the keenly awaited broadband services of RIl under the Jio brand, he said the company has invested Rs 32,000 to Rs 33,000 crore in the venture till now.
The telecom venture, whose employee strength has grown to 3,000 from 700 last year, has been making a series of partnerships and investments on the infrastructure front like acquiring spectrum and tie-ups with peers, the CFO said.He said as the capex cycle moves forward, there will be a marginal drop in the company's cash balances in FY15.