New Delhi, March 16
The Directorate-General of Hydrocarbons (DGH) has questioned the UK-based Cairn Energy's claims on the estimated in-place reserves in the Rajasthan block.
The company, which has said that it may sell between 25 per cent and 80 per cent of its shares in its Indian business through an IPO, has estimated that in-place oil in its Rajasthan exploration block exceeds 3.5 billion barrels.
Business Line, the Director-General of Hydrocarbons, Mr V.K. Sibal, said that as far as DGH was concerned the company had approved in-place reserves of 1.16 billion barrels on the basis of development plan submitted Cairn.
"We have asked the company to give details for the basis of their announcement," he added.
As per the DGH, the company is in violation of the production-sharing contracts it has signed, which require Cairn to inform the authorities as and when the reserves are revised.
Cairn spokesperson said, "We are willing to give any clarifications sought by the appropriate authorities." The company estimates that in-place reserves are in excess of 3.5 billion barrels in the Rajasthan block - the biggest oil find in India in two decades.
It upgraded recoverable reserves from Mangala, Bhagyam, and Aishwariya - three of the dozen discoveries in the Rajasthan block - by 20 per cent to 606-795 million barrels.
Besides the Rajasthan block, Cairn has 22.5 per cent stake in the 50,000 barrels a day Ravva oilfield and is the operator of the Cambay Basin block CB/OS-2, home to 130 million standard cubic feet a day producing Lakshmi and Gauri gas fields, and a potential oilfield. While making the IPO announcement, Cairn had said that the offering may happen before oil production commences in Rajasthan fields in 2008.
The appraisal process for the Rajasthan block was on. " We are still waiting for the Field Development Plan for Mangala and Aishwariya. Once we get it, we will sanction the project and move forward. We are looking to begin production in 2008," Mr Bill Gammell, CEO, had said.Related Stories:
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