Cairn ups peak estimate from Rajasthan oilfields

Cairn India today announced an increase in the estimates of potential crude oil peak output from its Rajasthan oilfields by 37 per cent, to 240,000 barrels per day.

The company has planned to invest $2 billion (Rs 9,100 crore) in calender years 2010 and 2011 in exploration, pipeline expansion and processing facilities.

“We have drilled over 50 wells in the Mangala oilfield, leading to a significant improvement in our understanding of the potential reserves. We now believe there is recovery potential of 6.5 billion barrels of crude oil against the earlier estimate of four billion barrels,” Rahul Dhir, chief executive officer and managing director, said here.

At the Bombay Stock Exchange, the company’s share price rose by 3.8 per cent, to close at Rs 292.80.

During 2009-10, the projected crude oil production in the country is 36.7 million tonnes (mt), 11 per cent higher than the actual production of 33.5 mt in 2008-09. This is mainly due to output from Cairn’s Barmer fields. With the revision of reserve estimates, Cairn fields at their peak would produce 12 mt in a year, pushing domestic output up by 34 per cent, to over 45 mt.

A 600-km pipeline from the Mangala processing terminal to Salaya (Gujarat) is likely to be commissioned by June 2010. Cairn India would further expand the pipeline to Bhogat in coastal Gujarat.

Of the total potential resources now estimated at 6.5 billion barrels, that from the Mangala, Bhagyam and Aishwarya fields, and others in the vicinity, are estimated at four billion barrels; it was earlier put at 3.7 billion. Evaluation of 22 other fields it has is on, the company said.