'Mangala crude output can be ramped up 20%'

Cairn India Ltd, the energy firm that London-listed Vedanta Resources seeks to buy, today said the giant Mangala oilfield in Rajasthan can produce 150,000 barrels per day, 20 per cent more than the previously approved peak production.

Mangala is the first of 25 oil and gas discoveries Cairn has made in the prolific Rajasthan block. The largest oil find in the country in more than two decades has an approved plateau production of 125,000 bpd (6.25 million tonnes) and, together with the Bhagyam and Aishwariya fields in the block, is slated to produce 175,000 bpd (8.25 million tonnes).

Today, the Mangala field in Rajasthan is producing 125,000 barrels of oil per day with the ability to go above that level from the Mangala field alone, Cairn India Chairman Bill Gammell told company shareholders here today. Gammell, who is also the chief executive of UK’s Cairn Energy Plc, which holds a 62.38 per cent stake in Cairn India, said the production can be quickly ramped up to 150,000 bpd (7.5 million tonnes).

“The results from the ongoing development drilling campaign in the Mangala field confirm the excellent reservoir quality of the Fatehgarh Formation to support an increase in the production potential to 150,000 bpd, subject to government of India approvals,” he said.

“The current estimate of the resource base in Rajasthan provides a basis for our vision to produce at least 240,000 bpd (12 million tonnes a year) from the block, subject to regulatory approvals and additional investments,” he said.

The output would be equivalent to what state-owned Oil and Natural Gas Corp’s prime Mumbai High field in the Western Offshore produces.

Cairn has commissioned three plants that can process 125,000 bpd of crude oil pumped out from wells in the Rajasthan block before dispatching them to refiners. A 590-km long crude oil pipeline from Barmer to Salaya, in Gujarat, carries the Mangala crude to Reliance Industries, Essar Oil and Indian Oil Corp (IOC) for processing.

The Mangala field in the Thar desert of Rajasthan was discovered in January, 2004, and put to production in late August last year.

Gammell said Vedanta Resources had made an offer to buy a 40 to 51 per cent stake in Cairn India from Cairn Energy Plc for up to $8.48 billion.