Cairn Energy positive about India's hydrocarbon potential

Monday, 17 January 2005, 20:30 IST
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NEW DELHI: British major Cairn Energy Monday expressed confidence about finding significant hydrocarbon reserves in India, which has over the last five years stepped up exploration activities to boost domestic oil and gas production. "Cairn's management had and still has a vision for the oil and gas potential in India. We believe that it is an area that has significant potential to be unlocked and field discoveries greater than 100 million barrels oil equivalent (mboe)," said W.B.B. Gammell, CEO of Cairn Energy, addressing a session at the ongoing Petrotech 2005 conference cum exhibition. Operating in India for the last 10 years, Cairn's gross investments within the country now exceed $1.25 billion. During the last decade, Cairn has drilled more than 100 wells in India, brought four exploration fields on-stream, made first deepwater discoveries on the east coast and struck oil in Rajasthan. Currently holding discovered or developed commercial reserves of well over 500 million barrels in India, Cairn has seen the company value rise from $10 million in 1992 to over $3 billion on the strength of its oil and gas finds here, said Gammell. "It is Cairn's belief based on its own experience that significant reserve additions are still possible and that application of state-of-the-art exploration technology in both mature and frontier areas will lead to further success," said Gammell. The company feels India's east and west coast, Bay of Bengal, Bombay High through Cambay and Rajasthan and Himalayan sub-thrust are among some of the promising areas in the Indian subcontinent. With India's oil import bill currently in excess of $20 billion, discoveries by companies like Cairn and Reliance are expected to bridge some of the growing gap between domestic production and rising demand. Over the last five years, India has given out 90 exploration blocks under the New Exploration Licensing Policy (NELP). Another 20 blocks are being offered under the fifth round of NELP. Cairn is expected to share its success story in India while participating in overseas road shows to be led by Petroleum Minister Mani Shankar Aiyar. "Certainly Cairn is interested in the fifth round of NELP," said Gammell later at a press conference. On further investments in India, the official said it would depend on the success of the drilling activities. In Rajasthan, where the company has struck gas in addition to an earlier discovery of over two billion barrels of oil in place, Cairn is eager to proceed with the northwest extension acreage it has been given till May to do the exploration. The new gas discovery is in a conventional reservoir in the Fatehgarh formation whereas the previously encountered Raageshwari gas has been in non-conventional volcanic reservoirs. The well, which has been drilled to a depth of around 3,000 metres, will be tested once drilling operations are completed. "We expect commercial production from Rajasthan by 2007," said Gammell. "We are still drilling for gas. There is every chance of it being a commercially viable gas field." On the possibility of Cairn being able to export gas to India from its blocks in Bangladesh, Gammell said the current alliance being worked out between India, Bangladesh and Myanmar for a tri-nation gas pipeline "may not include export of Bangladesh gas". Currently producing 120 million cubic feet of gas per day from its Bangladesh blocks jointly with Halliburton, Cairn is hopeful of raising the gas output to 200 million cubic feet by March and thence to 250 million cubic feet per day.
Source: IANS