The Hindu Business Line : Cairn working on expanding Mangala development proposal

New Delhi, Sept. 11 Cairn India Ltd today said that it is working on a proposal to expand the Mangala field development plan (FDP) to include an oil export pipeline, which will transport Rajasthan crude from the field to a coastal location in Gujarat. This is following Government nod to buy land for an oil pipeline to take crude from its developments in Rajasthan to the coast.

It is expected to be a 582-km pipeline from Barmer district of Rajasthan to Salaya in Gujarat. “We have started the Right of Use (RoU) process,” Cairn India CEO, Mr Rahul Dhir, said. However, the Government approval to allow the pipeline cost of about $780 million to be recoverable from field revenues is yet to be taken. Cairn is working on a proposal to expand the Mangala FDP to include the pipeline cost in it. The pipeline cost will be funded in 70:30 ratio by Cairn and state-run Oil and Natural Gas Corp (ONGC). ONGC holds 30 per cent stake in MARS field.

Oil export solution

The company today said the operating committee of RJ-ON-90/1 block has agreed to an oil export (midstream) solution. This proposal has been sent to the Government for approval, after which it will be submitted to the block management committee. The proposal is to expand the Mangala FDP to include an oil export pipeline. The proposed routing of the pipeline will allow access to an extensive existing pipeline infrastructure and refinery network, with a final coastal delivery point that also affords access to the majority of India’s refining capacity, the company said.

Cairn said that it was committed to delivering first oil from the Rajasthan fields in 2009. In order to meet the projected schedule, the front-end engineering and design has already been completed and the procurement process for several long lead items has commenced.

By end of 2009, output from Rajasthan fields would be 1,00,000 barrels per day. The Mangala field will be brought on production first followed by the Bhagyam and Aishwariya fields and the targeted gross plateau production from these three fields is 150,000 barrels per day by 2010.