Mercator to see significant growth oil & gas segment ramps up
Mercator Petroleum, a subsidiary of Mercator announced that it has mobilized all the equipment at site and is all geared up for First Sale of oil in August 2018. It received the mining lease for the oil blocks in June 2018 for a period of 20 years. The company has an approved Field Development Plan for 23 million barrels of proven high-quality oil in their oil block in the Cam bay basin.
First sale from oil block expected in August 2018 and H2FY19 earnings to see significant growth as oil & gas segment ramps up.
The company has signed a MOU with Indian Oil Corporation for sales of its crude oil.
The oil block will produce light sweet crude oil, the company aims to close FY19 at a production rate of Rs. 5,500 barrels of oil per day.
For the developmental wells yet to be drilled, environment clearance is under progress. When the company enters into the second phase of exploration, they expect new discoveries and reserves to increase significantly.
The oil & gas segment is expected to be Mercator's largest growth driver FY20 onwards, with ~35% of FY20's EBITDA contribution coming from oil & gas.
Projected Production Schedule
FY19 end; production rate: 5,500 barrels per day
Projected Production per annum.
a) FY19: 500,000 barrels
b) FY20: 2 million barrels
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