Oil exploration firm Cairn India on Tuesday said that it has got government approval to build a pipeline to transport crude oil from its fields in Rajasthan to refineries.
Cairn received permission to use land (Right of Use) for laying a 582-km pipeline from Barmer district of Rajasthan to Salaya in Gujarat, according to Cairn India chief executive officer (CEO) Rahul Dhir. He said that the company was committed to delivering first oil from the Rajasthan fields in 2009.
Cairn plans to begin production from Mangala (the largest of the 18 discoveries in the Rajasthan block) in 2009. However, Cairn is still awaiting government approval to allow the cost of the $780-million pipeline to be recovered from field revenues, as other project costs are.
?We are confident about approval of inclusion of the pipeline in the Field Development Plan (FDP),? Dhir said.
Cairn India has planned an investment of about $1.8 billion in bringing to production the Mangala, Aishwariya, Raageshwari and Saraswati (MARS) finds. Another $500 million are proposed to be invested in Bhagyam field. The investment proposal has just been submitted to oil regulator DGH for approval.
The Mangala field will be brought on production first followed by the Bhagyam and Aishwariya fields and the targeted gross plateau production from these three fields is 1,50,000 barrels per day by 2010. ?By end of 2009, output from Rajasthan fields will be 1,00,000 barrels per day,? he said.
The estimated in place reserves in MARS fields and Bhagyam field total 2.2 billion barrels of oil equivalent (boe). Additional smaller and low permeability fields and reservoirs have an estimated in place volume of more than 1.4 billion boe.