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| Essar to sell natural gas from Raniganj by Jan |
| Press Trust of India / New Delhi Nov 02, 2009, 17:04 IST |
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Essar Oil said it will begin sale of natural gas it is extracting from below coal seams in West Bengal in January-March quarter.
Reputed international agency, NSAI has certified the in-place reserves at the company's Raniganj coal bed methane (CBM) block in West Bengal at a level of 3.1 trillion cubic feet (tcf).
Of this, one-third reserves are recoverable, with upside potential, the company said in a press statement here. "Gas flow has already started and sales are likely to commence from Q4 FY2010," it said.
Having won the 3.2 tcf Rajmahal CBM block in Jharkhand in the just concluded fourth round of bidding for CBM blocks, Essar has emerged as a leading CBM player.
Essar Oil Managing Director Naresh Nayyar said: "Essar Oil is fast emerging as a major player in the CBM space in India, with a potential in-place resource of over 8 tcf. Going forward there would be a lot more focus on E&P."
Mumbai-based Essar Oil, the operator of India's second-largest non-state, crude-oil refinery, reported a 24 per cent drop in second-quarter turnover of Rs 11,144 crore from Rs 14,695 crore in same period last year.
"Against the backdrop of volatile oil prices and pressure on refinery margins, the company has posted a net loss of Rs 94 crore for the same quarter," the statement said.
Profit for the six-months ended September 30 rose 36 per cent to Rs 76 crore. Turnover was up 25 per cent to Rs 19,039 crore.
On the refining operations, Nayyar said the company's Vadinar refinery in Gujarat was "operating well above the installed capacity and the company is now looking at newer markets. We expect to build on our inherent strengths and core competence to steer the company towards growth during the current financial year".
Essar's 10.5 million tonnes a year refinery at Vadinar in Gujarat achieved highest ever crude output of 3.63 million tonnes in the July-September quarter and earned a margin of $4 on processing of every barrel of crude.
"The refinery is currently operating at 14 million tonnes per annum at a capacity utilisation of 133 per cent. Total crude processed in the 2nd quarter of FY2010 has been 3.63 million tonnes, its highest ever," the company said.
Production of higher margin light and middle distillates jumped to 75 per cent during Q2 of FY10 from 65 per cent of all products a year ago.
Essar said it was on track to expand the refinery to 16 million tonnes by December 2010. Debt of Rs 4,600 crore for the expansion has already been tied up.
The financial closure of Phase-II expansion by 18 million tonnes is expected by March 2010, the statement said.
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