Anil Agarwal-led Cairn Oil and Gas, a vertical of Vedanta Ltd, has got a ten-year extension on its production-sharing contract (PSC) for Ravva block in Andhra Pradesh from the Directorate General of Hydrocarbons. The extension will enable the Joint Venture partners to recover 13 million barrels of oil equivalent (mboe).
With this extension, the PSC is now valid effective October 28, 2019, for the next 10 years. Ravva, the oldest producing asset in India for Cairn, becomes the first large field to get PSC Extension under the “policy for the grant of extension to the production sharing contracts signed by government awarding small, medium sized, and discovered fields to private joint ventures”.
Cairn and its partners will invest Rs 550 crore ($78 million) to drill seven wells under Revised Field Development Plan (RFDP) targeting additional reserves of 11.7 million barrels of oil equivalent. “The Ravva PSC extension is one more example of the trust the government has reposed in us. We look forward to working with all our partners towards achieving our vision of contributing 50 percent of the country’s domestic production and supporting the government in its energy security goal,” said Anil Agarwal, Chairman, Vedanta Resources.
Through speedy adoption of cutting-edge technologies, Cairn took production in Ravva up from 3,000 to 50,000 barrels of oil per day, and sustained this production for nine years. “Fast-tracking decision making will help quicker and timely recovery of these additional reserves. Ravva is a fine example of augmenting production in an ageing oil field with the help of the most advanced technological interventions in the industry globally,” Ajay Kumar Dixit, chief executive officer (CEO), Cairn Oil and Gas.
“We have also always advocated a sustainable and safe work environment and Ravva has been a testament to our efforts with a slew of awards to its credit. Our endeavour is to make Ravva a global case study for enhanced recovery in an ageing oil field,” he added.
As of October 31, 2019, this asset has produced 295 million barrels of oil and 418 billion cubic feet of gas equivalent to 365 million barrels of oil equivalent. Cairn and its partners, including ONGC, generated revenues of $16.8 billion till March 2019. The companies also contributed around $7.5 billion to the government exchequer till March 2019. Cairn said that some of the technologies deployed in Ravva block include 4D Seismic, E-line, tractor and stoker base-milling operations, cement packer jobs and produced water reinjection.