Cairn India will invest $3.8 billion in oilfields in Rajasthan and laying a pipeline to transport the crude oil that will begin flowing in less than eight months from now.
The company, along with its partner state-owned ONGC, will invest about $2.9 billion in developing the Mangala, Bhagyam and Aishwariya (MBA) fields, the first three of the 25 discoveries in the Rajasthan block that are being put to production Phase-I.
Another $940 million will be invested in laying a pipeline from Barmer district to the Gujarat coast for transporting the crude oil. In 2005, $1.5-1.8 billion was envisaged to be invested in MBA field development to produce a peak output of $1,25,000 barrels per day of crude oil. The production estimate has since gone up to 1,75,000 bpd, resulting in the revised cost, said an official of Oil and Natural Gas Corporation (ONGC). The hike in cost was on account of increase in facilities to be constructed, rise in equipment cost, and more drilling charges and manpower cost, he said.
The well flows at a stabilised rate of 500 barrels per day and will add to the resource base in Rajasthan, Cairn said.
The discovery is located about 1.5 km east of the Raageshwari-1 well in the southern part of the Mangala, Aishwarya Raageshwari and Saraswati development area.
Mangala is the biggest of the 25 oil and gas finds in the Rajasthan block and it alone can produce 125,000 barrels of oil per day (6.25 million tonnes).
