India’s Reliance Industries (RIL) has won conditional approval for the proposed $1bn investment in the KG-D6 gas block located offshore of India.
The state-controlled management committee (MC), headed by director general of hydrocarbons (DGH) Rajiv Nayan Choubey, also allowed Reliance and its partner BP to develop three other gas fields in the same block, reports the Economic Times.
The operator will only be able to recover costs after "extensive appraisal" of these discoveries to formally establish commercial viability, government sources said.
The appraisal wells will also have to be drilled by RIL and BP at their own cost.
RIL agreed to provide the comptroller and auditor general of India (CAG) access to records of the KG D6 block.
Drill stem tests on the wells will need to be carried out to establish sustainable production levels and submit data to the DGH for verification.
Once the finds are declared commercial, RIL-BP will put forth an integrated development plan for the three finds together with 13 other discoveries.
RIL operates the block, while BP owns an interest and Niko Resources of Canada has the remaining stake.