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Vinod Mathew

Ahmedabad , Sept. 29

THE `declaration of commerciality' of the Saraswati field (RJ-ON-90/1) in the Barmer basin of Rajasthan, that has been pending with the managing committee of the Ministry of Petroleum and Natural Gas (MoPNG), is likely to come through in a week's time.

The Union Minister for Petroleum and Natural Gas, Mr Ram Naik, said this in answer to a question pertaining to the status of the Saraswati field that Cairn Energy purchased from the Shell group.

Mr Naik, while talking at the unveiling ceremony of the Royal Dutch/Shell Group of Companies' LNG terminal at Hazira on September 19, had said that a declaration pertaining to the commercial viability of the Saraswati fields could be expected over the next 15 days. And on Sunday, when asked about the status of the declaration, Mr Naik said, "There is still time to go for the 15 days' time to be up. It is still on schedule. One can expect the declaration to be made over the next week."

The field, being operated by Cairn Energy India Pty Ltd, is understood to be figuring pretty high on the list of priorities of the parent British company, as it is betting on both the Saraswati as also the next one on the line, the Rajeshwari field, to significantly prop up its oil and gas reserves in the short-term basis.

Meanwhile, Mr Alan Linn, Country Manager, India, Cairn Energy India Pty Ltd, said the company was bullish on the Saraswati field as it was on both the Lakshmi and Gauri fields in the Gulf of Cambay, where in all 11 wells have been drilled till date. The Cairn Energy has drilled three appraisal wells in the Saraswati field.

"We expect to be able to produce gas from the Gauri fields on a commercial basis by May 2004. This field is shaping along the expected lines and should come good for 40-80 million standard cubic feet (scft) per day just as the Lakshmi field is currently doing 110 million scft daily. We expect to leverage the existing contracts to sell additional volumes once they become available," Mr Linn said.

It is expected that once the commercial viability nod comes through, Cairn Energy would push for its development plan approval. This would include a perspective on the number of wells that would be drilled as also the overall investment that will be made in both Saraswati and Rajeshwari fields in various phases. The entire process may take up to six months before Cairn Energy would get a crack at drilling wells on a commercial basis in the Barmer basin.

Cairn Energy has already invested in excess of half a billion dollars in India between its Ravva field in the Godavari basin of Andhra Pradesh in the east coast and the Cambay basin fields in the west coast. With the Ravva field producing 50,000 barrels of oil and some 80,000 million scft of gas, out of the total South Asia production of 1,25,000 barrels oil equivalent per day, evidently its India operations are crucial to the company.

The Cairn Energy, with roots in the North Sea oil fields, had begun training its guns on South Asia once production from the UK offshore fields began to lose steam. While it recently consolidated the Bangladesh end of operations, buying stake in the Sangu development area from Royal Dutch/Shell at an aggregate cost of $50million, the company is looking for a potential partner to better leverage its Godavari offshore fields, mostly due to financial constraints.

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