Cairn finds more oil in Rajasthan

British oil and gas firm Cairn Energy announced its second big oil discovery this year in Rajasthan, where in January it had found India's largest oil field in more than two decades.

The discovery has been made in the exploration block RJ-ON-90/1, where it drilled the N-A-1 well 8 km south of the Mangala oil discovery.

"The two discoveries constitute the biggest oil find after Mumbai High in 1974," Petroleum Minister Ram Naik said.

The well is estimated to have inplace reserves of 100-460 million barrels and preliminary recoverable reserves of 20-70 million barrels, according to a press release issued by the petroleum ministry. This discovery is expected to produce around 0.5 million tonnes of oil per day.

The discovery is about one-third of the N-B-1 well, now named Mangala, which is estimated to hold 450-1,100 million barrels of inplace oil reserves, of which 50-200 million barrels are estimated to be recoverable. The Mangala find can produce an estimated 2.5 million tonnes of crude annually from 2007.

Cairn holds 100 per cent interest in the exploration block. However, as per the production sharing contract, Oil and Natural Gas Corporation can take a 30 per cent interest in it in case of a commercial discovery.

Cairn announced that the well encountered a gross oil column of 120 metres and a net pay of 15 metres in excellent quality sands of Gatehgarh formation.

Preliminary testing results show an oil flow rate of 1,220 barrels per day with specific gravity of 31 degrees API from tested interval of 1,213-1,221 metres.

Cairn said the current drilling programme was being reviewed to allow early appraisal drilling of the N-A-1 discovery to assess reservoir distribution.

The company said the N-A-1 well also encountered a log evaluated oil bearing column of 60 to 150 metres in an apparently tight, silty Barmer Hill formation. This formation is a possible candidate for future explorations.