Investment in excess of $1 Billion planned
The Cabinet Committee on Economic Affars (CCEA) recently approved an extension to the Production Sharing Agreement (PSC) for pre-NELP (New Exploration Licensing Policy) Blocks. Cairn India has got an extension of 10 years ie upto 2030 (or upto economic life of field, whichever is earlier) for its Rajasthan, Barmer fields.
The Rajasthan Block (RJ-ON-90/1) includes the Mangala, Bhagyam, Aishwariya, Raageshwari, Barmer Hill etc fields and is spread over 3,111 sq Km in the Barmer District. This is the biggest onshore project and accounts for 27% of India’s Oil production.
This will not only allow Cairn India to extract remaining reserves, but also undertake additional revovery through EOR (Enhanced Oil Recovery) projects.
Cairn India has planned a cumulative investment of US$ 1 Billion into the Barmer fields for 5 projects – EOR programmes at Aishwariya, Bhagyam, Barmer Hill and Aishwariya Barmer Hill, Raageshwari Deep Gas project. Once all formalities related to the extension of the Rajasthan block are complete it is expected that the company would initiate investment and complete the projects within a period of 24 months.
Cairn India holds 70% stake in the Rajasthan block while ONGC owns the remaining 30%.
Written with some inputs from Live Mint.