Cairn India’s production from its Barmer field in Rajasthan can be good news for housewives of smaller towns at a time when domestic LPG is in great time.
Estimates show that the Barmer crude if refined in any of the modern domestic refineries can yield enough LPG to fill 4.5 million cylinders of 14.2 kg per month.
Besides, the Barmer crude will also yield fuel for 3.4 million cars each day, averaging about 150 liters per car per month. With more and more people being able to buy cars thanks to the smaller/people?s cars introduced in the country this is surely good news, industry sources said.
During 2008-09, consumption of petroleum-products registered a growth of 3.5% to 1,334 lakh tonne. The domestic crude production was weak most of the months during this period, resulting in a drop of production of 1.8% (335 lakh tonne) during the year. At the current level of oil production of around 660,000 barrels a day, India remains grossly energy deficit.
As production is ramped up to 1,75,000 bpd by 2010-11, the Barmer crude oil production will account for more than 20% of India?s current total crude production. This will also help savings on transportation costs for imported crude. This additional fuel in the market will bring relief since the calendar 2008-09 witnessed a healthy growth in demand for petrol and diesel by 9% and 8.4%, respectively.
India is significantly dependent on import of energy in the form of crude oil, gas and coal to meet its requirement for its growth. In a recent announcement, Cairn had confirmed that its first train, with a capacity to handle 30,000 barrels of oil per day from the Mangala Processing Terminal (MPT), is complete and ready to start production. The initial production will be gradually ramped up through the second half of 2009 with arrangements in place for initial dispatch of the Barmer crude by trucking.
Meanwhile, PTI quoting Goldman Sachs latest report, said that Cairn India’s prolific Rajasthan oil fields, which are likely to go on production next month, will bring down India’s oil import bill by $6.8 billion.
Based on the recent discoveries in the Rajasthan basin, Goldman Sachs believes that Cairn’s peak production level can go beyond the company?s present guidance of 175,000 barrels per day (8.75 mt a year). It forecast a peak production of 190,000 bpd (9.5 million tons a year) of oil from Rajasthan by end of 2012-13 fiscal, the PTI report added.
According to Goldman Sachs, ??We now estimate this would represent about 20-22% of India?s total domestic oil production in FY2013, making the Rajasthan project one of national importance. Rajasthan oil would likely bring down India?s oil import bill by $6.8 billion at peak production, which is about 7% of the country?s net oil import bill.??
India, in 2008-09 paid $75.5 billion (Rs 3,41,887 crore) to the oil exporting nations to meet the energy requirement of the growing economy. In addition to this, the government incurred a fuel subsidy of $18 billion, the report added. India?s current oil production is around 660,000 bpd (33 million tonne a year).