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Essar Oil to double CBM production this year
Company to ramp up wells count in Raniganj East block coal fields, seeks to triple output to 2.5 mn scmd in FY18, from current level. Essar Oil & Gas is planning to ramp up its coal-based methane (CBM) production to a minimum of 1.8 million standard cubic metres per day (scmd) by the end of the current fiscal year from the existing 0.85 million scmd and scale it further up to 2.5 million scmd during 2017-18.
In this endeavour, it will increase its wells count in theRaniganj East block coal fields from the near-300 mark to 363 this year. “We’ll complete the increase in well count by March 2017. Of the near 300 wells now, 266 have been fracked while 247 have been completed and 175 have been on active de-absorbtion cycle”, the company’s CEO of exploration and production, Manish Maheshwari told Business Standard.
It has a revenue-sharing contract with the government for the 260-acre Raniganj CBM project, where it has been granted mining rights for 500 sq km. So far, the company has made an investment of Rs 3,300 crore in this project, which is in advanced stage of operations. The company owns CBM mining rights in the coalfields in Raniganj in West Bengal, Sohagpur in Madhya Pradesh-Chattisgarh, Rajmahal in Jharkhand and Talcher and Ib Valley mines in Odisha making it the largest private CBM producer in India.
“Rajmahal will also begin production in five years. Currently there are 20 core holes in this project and we have received the necessary approvals for land acquisition there. At present only Raniganj is producing the CBM but other projects will come up in time”, he said. This project, where the company is pumping in $ 3-4 million is in its primary stage. While land acquisition approval for the Sohagpur minefield is pending from the Chattisgarh government, the Petroleum Exploration Licence for the Talcher and Ib Valley coalfields is pending from the Odisha state government.
All these coalfields is supposed to have a reserve of 12 trillion cubic feet (tcf) of CBM of which Raniganj has a possible reserve of 1.1 tcf. To extract CBM from these coal mines, the company has employed six drilling rigs of which two have been procured from Greka drilling on a contractual basis. It is also on the lookout for CBM mining projects globally including Iran but will keep off “matured markets” like USA and Australia.
Besides, Essar Oil & Gas, which is expecting the global crude scenario to remain buoyant at a maximum of $ 50 per barrel of oil till mid-2017 is also planning to aggressively increase its count of petrol pumps from over 2,000 outlets to 5,000 outlets by 2018. Butch Goring Jersey
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