New Delhi: Marking a milestone in two decades, Cairn India will begin crude oil production from its Rajasthan desert field of Mangala next month, helping the energy-deficit nation cut imports.
"We are operationally ready to commence oil production in
August," Cairn CEO Rahul Dhir said.
More than six decades after India gained independence
from the British raj, a unit of UK's Cairn is helping the one billion nation boost its oil production of around
680,000 barrels per day (bpd) by over a quarter.
Cairn had given the nation its most prolific oil find in
more than two decades since Oil and Natural Gas Corporation
(ONGC) discovered the Gandhar field in Gujarat.
Cairn's Rajasthan oil fields will bring down India's oil
import bill by USD 6.8 billion or 7 percent, Goldman Sachs
said, adding that peak output from the fields is likely to be
190,000 bpd (9.5 million tonnes a year).
Cairn has said the output will quickly touch 30,000 bpd
by the end of third quarter this year and reach a plateau of
175,000 bpd (8.75 million tonnes a year) in 2011.
Dhir said pricing negotiations for the initial off-take
from Rajasthan crude have been concluded with the government
of India nominees which are the Indian Oil Corp (IOC) and
Mangalore Refinery and Petrochemicals Ltd.
"We have concluded pricing negotiations with MRPL and IOC
for the initial quantities of crude from Rajasthan which
currently represents a 10 to 15 percent discount to Brent."
The government has approved the revised Mangala field
development plan including pipeline and higher processing
capacity of 205,000 barrels per day, a Cairn statement said.
The company has drilled 28 wells on the Mangala oilfield
in the Rajasthan blocks, out of which 16 have been completed
and are ready to start production.
The first processing train of 30,000 barrels per day
capacity is ready and the second unit would be ready by the
fourth quarter of 2009.
"Cairn is working with the government authorities to
start production from the Mangala field in Rajasthan in
August," the statement said.
The pipeline transporting crude from the deserts of
Rajasthan to the Gujarat coast will also be completed by end
of 2009.
Train three (50,000 bpd) which will follow Train two is
on target to attain Mangala plateau production of 125,000 bpd
by H1 2010.
Cairn reported a net profit of Rs 45.44 crore in the
quarter ended June 30 as against Rs 138.58 crore in the same
period last fiscal.
Total Income has decreased from Rs 461.43 crore for
April-June quarter last year to Rs 333.92 crore for the
quarter ended June 30, 2009.
The average oil price realisation in Q1 was USD 60.2 per
cent as against USD 125.9 a barrel a year ago. The gas price
realisation in Q1 2009-10 was USD 4.0 per thousand cubic feet
as opposed to USD 4.3 a last year.
Bureau Report
First Published: Thursday, July 30, 2009, 11:28