In 2007 there was gas leakage from the irrigation borewells in few villages of Putluru and Yellanur mandals of Ananthapur District A.P, India. To identify the structural features which cause the leakage of gas in this region magnetic studies were carried out along few traverses and analysed the data qualitatively and quantitatively. The Total Magnetic Intensity (TMI) contour map and IGRF corrected TMI maps clearly shows the features of low and high magnetic anomalies which indicates two different susceptibilities. Reduced to pole (RTP) technique is applied to the magnetic data to simplify the complex anomalies and generated contour map, in which the structural features are easily identified. The low anomalies are due to Tadipatri shales which are present in this region upto 4km depth and the high anomalies are due to sill intrusions in the shale region. Maximum borewells are located near the edge of these high and low anomalies. These edges indicates the fault zones which is the source for the leakage of methane gas from the deeper depths of the subsurface region.