The Hindu Business Line : Cairn asked to work out appraisal programme

New Delhi June 18 Cairn India has been asked to work on an appraisal programme in consultation with the Directorate-General of Hydrocarbons (DGH) for its northern appraisal area (NAA) in Rajasthan Basin. This in effect would put to rest all speculations on the validity of the company's recent two discoveries (announced last month) in the region.

A senior Petroleum Ministry official told Business Line, "We have asked Cairn to work out an appraisal programme for the area with the DGH." Once the appraisal programme is in place the company would be able to not only validate its two recent discoveries in NAA, but also explore the full potential of the region.

According to a Cairn official, "Appraisal work is ongoing and the company is in discussions with the DGH to agree to the appraisal programme as per Government directions." NAA is turning out to be a high prospect region for Cairn with the company expecting additional discoveries. The potential of the area is in excess 200 million barrels of oil.

The two discoveries - Kameshwari West-2 and Kameshwari West-3 - in the Rajasthan Basin announced by Cairn were in the news when it was reported that DGH had refused to recognise them on the grounds that both the wells were drilled after the expiry of a minimum work programme period.

Extension granted

Cairn had notified DGH about Kameshwari West-3 on May 9 and about Kameshwari West-2 on December 16, 2006. In June 2005, Cairn was granted an 18-month extension (until November 14, 2006) to complete its activities in the northern appraisal area. However, severe flooding in Rajasthan last year had interrupted the work programme leading to ceasing operations in the area. The company had initiated discussions with the Government for a further extension of part of this acreage to complete its planned work programme.

Last month, Cairn was given a six-month extension (from May 2007) for the Exploration Phase of the northern appraisal area of RJ-ON-90/1. Thus, allowing Cairn to carry out an appraisal programme to delineate and explore the full potential of the region.

Till now Cairn India has made 22 discoveries in Rajasthan Basin. India currently imports approximately 20 lakh barrels of oil per day (bopd). It produces approximately seven lakh bopd domestically, of which about 50,000 bopd comes from Cairn India-operated Ravva field on the East Coast.

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