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U.K. supermajor BP plc (BP - Analyst Report) and its partner India’s Reliance Industries (“RIL”) have struck gas for the second time off the east coast of the Cauvery basin in India.

The deepwater gas condensate discovery in the exploration well CYIIID5-S1 is situated in Block CY-DWN-2001/2, about 62 kilometers from the coast in the Cauvery Basin. With a primary goal of exploring Mesozoic-aged reservoirs, the probe was drilled to a total depth of 5,731 meters, in water depth of 1,743 meters.

Preliminary appraisal of well data and fluid samples revealed that the well traversed a gross hydrocarbon column of 143 meters in the reservoir interval. During the drill stem test performed to assess the potential of the discovery, the well flowed at a rate of 35.2 million cubic feet of gas per day and 413 barrels per day of condensate, on a 20.6 millimeter choke.

The initial reservoir pressure of the well was 8,000 psi. Per the company’s statement, the well flow rates are restricted by the rig and well test equipment configuration during such tests. The well had attained its total depth in early August.

A notification with respect to the discovery has been sent to the Government of India and India's Directorate General of Hydrocarbons (DGH). The authority has named the latest find as D-56. The first discovery was made in July 2007.

The operator of the block, RIL, has an interest of 70%, while BP has a stake of 30%.

The latest find is a positive for both the companies, which have been criticized so far for not being able to ensure the fall in output from the rich KG D6 block. A declaration of commerciality is now required to be submitted to the DGH by the companies. However, the duo may drill one or two more appraisal wells before submission.

BP carries a Zacks Rank #3 (Hold). However, there are other stocks in the oil and gas sector – Range Resources Corp. (RRC - Analyst Report), Susser Petroleum Partners LP (SUSP - Snapshot Report) and Dril-Quip, Inc. (DRQ - Analyst Report)  – which hold a Zacks Rank #1 (Strong Buy) and are good investment options.

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