Cairn India can produce up to 2,40,000 barrels per day from its prolific Rajasthan fields, equivalent to output from the nation's largest oilfield of Mumbai High, the company has informed the government.
Cairn India CEO Rahul Dhir last week wrote to the Petroleum Ministry and the sector regulator DGH informing that it can produce 37 per cent more oil from the Thar dessert fields than previously thought.
"Based on our review, we estimate that the potential resource in the (Rajasthan) block is now estimated to be 6.5 billion barrels of oil equivalent in place. This resource base provides a basis for a vision to produce 2,40,000 barrels of oil per day, subject of course to necessary approvals and additional investments," he wrote in identical letters to Petroleum Minister Murli Deora, Oil Secretary S Sundareshan and DGH Director General S K Srivastava.
The letters, written before the company went to stock exchanges and press about the reserve increase on March 23, stated that the revised estimates were based on Cairn completing a comprehensive review of the resource potential of the Barmer Basin in Rajasthan through the application of innovative technologies and advanced geoscience.
"In addition, DeGolyer and MacNaughton have also conducted an independent assessment of reserves and contingent resources, and have also reviewed the majority of the leads and prospects in prospective resources. Their work is in line with Cairn India estimates," he added.
Peak output envisages from the Thar dessert fields is now estimated at 2,40,000 bpd (12 million tons per annum), equallying production from state-run Oil and Natural Gas Corp's prime Mumbai High fields in the western offshore. Mumbai High is the nation's largest oilfield.
Cairn raised estimates of oil and gas in place in Barmer fields to 4 billion barrels of oil equivalent from 3.7 billion boe previously. Further, there could be another 2.5 billion boe yet to be discovered.
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The company had earlier projected a peak output of 175,000 bpd.
Cairn India, a unit of UK explorer Cairn Energy Plc, in December 2004, discovered the Mangala field in the Rajasthan block - the largest onland oil discovery in the world that year.
Mangala, the largest onland oil field in India, was estimated to produce a peak output of 125,000 bpd which has now been revised to 150,000 bpd following more than anticipate oil from some 50 development wells drilled on the field so far.
Cairn said oil potential from this field had been revised upwards to 6.5 billion barrels of oil equivalent from an earlier estimate of 4 billion barrels.
Cairn holds 70 per cent stake in the field, while state-owned ONGC holds the remaining 30 per cent. So far Cairn India has invested about USD 4 billion. It will invest another USD 2 billion by 2011.
The company currently produces about 25,000 barrels of oil per day and expects this to increase to 1,25,000 barrels in the second half of 2010.
Besides Mangala, Bhagyam and Aishwariya are other major fields in the Rajasthan block. The three fields hold 2.1 billion boe in place of which the proved and probable recoverable resource base is over 1 billion barrels. 22 other fields are estimated to hold about 1.9 billion boe in place of which the gross recoverable resource is estimated to be 140 million boe.