The Hindu Business Line : Cairn to start seismic work in Ravva fields

Generating revenues
Cairn & its partners invest $1.01b in Ravva
Results in $4.07 b to Centre in profit petrol, cess; $63 m on gas royalty
Fields further generates sales tax of Rs 1,335 cr for State

V. Rishi Kumar

Hyderabad, Nov. 29 Cairn India is in the process of finalising plans to take up time lapse 4D seismic studies in the deeper sands of the Ravva Oil fields in the Krishna Godavari basin region.

This is aimed at enhancing the recovery in the oil wells for the next phase of growth. The Ravva fields have been a cornerstone for Cairn’s growth in India, even as the company takes up other fields in India and the region.

“The 4D seismic time lapse study will be taken up early 2009 and help assess additional potential in the region and thereafter chart out investment plans,” a senior company official told Business Line.

Ravva fields have sustained an average production level of 50,000 barrels a day, contributing to country’s oil production and through various taxes.

Evaluating options

As is the case with oil fields faced with the prospect of plateau and decline, the Cairn consortium is evaluating various options to upgrade reserves.

These include enhancing the recovery through water injection and gas lift support, undertaking 4D seismic work in discovered reservoirs aimed at adding incremental reserves and developing them through drilling campaigns.

The company also plans to explore deeper wells and to tap into potential development of satellite pools and discoveries, he explained.

Already two exploration wells have been drilled. Four small-sized oil and gas discoveries made.

These new wells are under test production yielding 525 barrels a day.

Technical work is underway to convert these discoveries into commercially extractible assets.

Investments

A modelling study by WesternGenco indicated that the Ravva fields are ideal for time lapse (4D) seismic acquisition, he said.

Cairn and its partners have invested $1.01 billion so far in Ravva for exploration, development and production yielding 200 million barrels of oil.

This resulted in $4.07 billion to the Central Government in profit petroleum, royalty and cess.

In addition, the Centre secured gas royalty of $63 million and the field also generated sales tax of Rs 1,335 crore for the Andhra Pradesh Government.

What was seen as marginal field has helped generate significant revenues over the years and also in the form of taxes and royalty.

Efforts will now be stepped up to sustain production in these wells, he explained.

Ravva field is known for lowest cost of production, which is now about $1.5 a barrel.

In fact, it was less than $1 in 2007. While the company builds on its investments in other parts of the country including Rajasthan, any incremental gain will add value, he felt.

Related Stories:
Ravva oilfield entering declining phase: Cairn
Cairn hopes to sustain Ravva output for a decade

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