Cairn bets on shale, sees 10% drop in India’s oil imports at peak output
Vedanta-owned Cairn Oil and Gas is betting on its shale exploration programme in its prolific Rajasthan asset, estimating that shale oil and gas production may reduce India’s oil and gas import by 10% when production kicks in. We will start shale exploration potentially in the next one or two months. With shale potential at 3 billion barrels of oil equivalent per day (boepd) we want to establish a reserve of 300 million boe and production target of 500,000 boepd. This will ultimately bring down oil imports by 10%,” Prachur Sah, Deputy CEO, Cairn Oil and Gas told ET. Shale is a type of natural gas trapped in fine-grained sedimentary rocks called shales. Cairn’s onshore Rajasthan oilfields – Mangala, Bhagyam and Aishwariya (MBA) – are its flagship and most prolific assets. They jointly produce up to 20% of India’s entire crude output. Cairn aims to produce 50% of the country’s oil and gas requirements but declining hydrocarbons production from the MBA fields has been a challenge. Cairn is planning to adopt enhanced oil recovery programmes to ramp up output. Last November, it tied up with oil field services majors Halliburton and Baker Hughes and more such tie-ups are in the offing.
Petronet considering fourth Indian LNG facility
Petronet LNG may look at constructing a fourth liquefied natural gas import facility in its native India as gas demand in the country continues to grow, according to chief executive AK Singh. “We believe gas demand will continue to grow and we will need avenues to meet such requirement,” he told the Press Trust of India in an interview. “We could possibly look at setting up a fourth LNG import and regassification terminal… these are preliminary thoughts, and we will come back to you once plans are firmed up.” The company currently operates the 17.5 million tonnes per annum Dahej receiving and regasification terminal, currently undergoing expansion to a capacity of 22.5 million tonnes per annum, and the 5 million tpa Kochi import facility – both of which are land-based terminals. Adding the planned 5 million tpa of additional capacity at Dahej – already the world’s largest import facility – involves construction of new jetty able to also handle propane and ethane shipments, plus an additional LNG storage tanks and bays for the truck-loading of LNG. The company’s third LNG import terminal is a planned floating storage and regasification unit-based facility at Gopalpur in the state of Odisha, expected to enter operation within three years.
Indian Crude Oil Basket Prices On The Rise Again; Up Over 8% Last Week
The Indian crude oil basket price is rising again, tracking the run-up in global oil markets on supply concerns as the Russia-Ukraine war intensifies. According to the Petroleum Planning and Analysis Cell report, the Indian crude oil basket price rose to $106.03 per barrel on April 15, 2022, at an exchange rate of Rs 76.22 per dollar. The price of the Indian basket crude was $97.82 per barrel on April 11, 2022, at an exchange rate of (Rs/$) 75.96, indicating over $8, or 8.39 per cent jump since then. While the latest price is below the March average of $112.87, it has risen well past the $103.02 per barrel on April 1. That surge in prices, coupled with the 26 paise weakening in the rupee against the dollar between April 11 and April 15, suggests an upward pressure likely on domestic fuel rates. Retail fuel prices have remained unchanged for the 12th consecutive day as on Monday, but if the rising trend in global crude and the Indian oil basket price continues, retailers would be forced to hike pump prices. Reports last week showed that petroleum Minister, Hardeep Singh Puri, had urged states to cut VAT on petrol and diesel for giving relief to consumers. Indian crude oil basket prices averaged $84.67 per barrel in January and $94.07 in February. The average cost in April last year of about $63 per dollar was significantly lower compared to the latest data. “The price of crude oil in the international market remains high, with the Indian crude oil basket still hovering around $104 per barrel today,” Petroleum Ministry Sources had told when asked about the softening trend back then. “It used to be around $70 to $80 per barrel some months ago,” the sources had added.