Cairn India to invest Rs 3,000 cr to improve oilfield recovery
Greater Noida: Cairn India plans to invest Rs 3,000 crore over the next three years to improve recovery from its prolific Rajasthan oilfield.
"We are launching the largest ever improved oil recovery (IOR) and enhanced oil recovery (EOR) schemes," Cairn India Chief Executive Officer P Elango said here on Monday.
The schemes will help recover over 90 million barrels of oil in the Rajasthan block and sustain peak output for a longer time.
Cairn India currently produces close to 1,85,000 barrels of oil per day from the Rajasthan block and will exit the financial year with over 2,00,000 bpd output, he said.
"Investments planned in IOR/EOR schemes is USD 575 million or roughly Rs 3,000 crore," Elango said.
The investment is part of the USD 3 billion capex the company had outlined last year. More than 80 percent (over Rs 12,800 crore) of the total capex will be spent on Cairn's prolific Barmer oil block in Rajasthan.
Of the current production, about 1,50,000 bpd comes from the Mangala field, the largest among over two dozen discoveries Cairn India has made in the Rajasthan block.
The oil major has plans to ramp up production from the Bhagyam field while also looking at producing oil from two smaller fields at the Barmer hills during the current financial year, he said.
Cairn India plans to drill 100 oil wells to monetise new reserves at the Rajasthan block, whose resource potential is 7.3 billion barrels of oil equivalent. The explorer is also evaluating options to monetise the discovered gas at its Sri Lankan block, Elango said.
The company, which is the operator of India's biggest onland oilfield, had reported a net profit of Rs 11,919.74 crore in the previous financial year on net sales of Rs 17,524.15 crore.
Cairn's earnings helped parent company Vedanta Resources to post a 21 percent growth in core profit (EBITDA) at USD 4.888 billion for the year ended March 2013 and a 163 percent growth in net profit attributable to shareholders at USD 157.4 million.
Cairn India alone contributed 49 percent of Vedanta's EBITDA (earnings before interest, taxes, depreciation and amortisation). Last year, the oil major had reported a 19 percent growth in production at 2,05,323 barrels of oil equivalent per day.