Cairn India, the operator of Barmer oil and gas block in Rajasthan, is planning to invest $100 million, a chunk of it to monetise its natural gas resources. The Vedanta group company is targeting to increase gas production to 40-45 million standard cubic feet per day (mscfd) by 2017 and to 100 mscfd by 2018-19.
“The capital investment is estimated for FY17 with 80% focus for development of Raageshwari Deep Gas (RDG) project and completion activities of Mangala enhanced oil recovery,” said a senior company official, who did not wish to be named.
Cairn India is developing the project in a phased manner to realise capital efficiency while maintaining production growth and is progressing on track, the official added. In the first phase, 8 out of the 15 wells have been brought online and will start adding to the production as per plan.
Rest of the wells are also planned to be brought online by December 2016. Contract for low cost augmentation of the existing facility will be awarded in October 2016. Tendering for enhancement of existing pipeline capacity is in advance stage and contract is expected to be awarded during the third quarter of FY17.
“Completion of phase-I is expected to increase the gas production to 40-45 mscfd by end of first half of the calendar year 2017. For second phase, tendering activity for new gas processing terminal and drilling rig is ongoing as per plan. Completion of phase-II will increase the gas production upwards of 100 mscfd and condensate production to about 5,000 boepd,” the official explained.
Since early 2013, the Rajasthan joint venture, where PSU explorer ONGC is 30% partner, is selling Raageshwari gas and delivering into GSPL’s Gujarat grid and fertilizer units in Gujarat via GSPL’s network. GSPL has been forthcoming in identifying and resolving bottlenecks in order to increase Rajasthan gas sales. GSPL along with its joint venture partners are laying a pipeline up to Barmer for offtaking higher volumes of natural gas through its Mehsana Bhatinda pipeline in future.
Natural gas production from RDG increased from 28 mscfd in first quarter of FY17 to 33 mscfd in the second quarter of FY17, amounting to 3 billion cubic feet (bcf). This is helped by superior initial well productivity post conclusion of the hydro-frac campaign. Total gas sales were 1.6 bcf, at an average rate of 17.2 mscfd. In-line with the focus on improving productivity and enhancing recovery through technology adoption, the expected ultimate gas recovery has increased by 26% compared to the initial estimates.