London, Sept. 3 (PTI): Scottish explorer Cairn Energy Plc has acquired Shell India’s entire stake in an oil and gas block in Rajasthan for around $ 7.25 million.
The company acquired Shell India’s 50 per cent interest in RJ-ON-90/1 block, giving Cairn a 100 per cent interest, a company statement said here today. “We anticipate significant additional hydrocarbon potential in this area and with a 100 per cent interest will now be accelerating exploration and appraisal drilling on the block,” Cairn’s chief executive Bill Gammell said.
Cairn also said it expects the first gas from its Lakshmi gas field offshore Gujarat in the third or fourth quarter of this year. Gammell said in the second half Cairn will concentrate on operational activities on its acreage in western India and is planning a multi-well drilling programme for both offshore Gujarat and onshore Rajasthan.
Cairn’s chairman Norman Murray said Cairn has made 10 hydrocarbon discoveries in India. Of these, four—Gauri, Ambe, Parvati and Lakshmi Oil—were made offshore in the shallow water depths of Gujarat block CB/OS-2 and one—Saraswati—was made onshore in Rajasthan RJ-ON-90/1.
The other five discoveries were all made in deep water offshore Andhra Pradesh in the Krishna-Godavari basin block, Murray said.
“The discoveries have the potential to add significantly to the group’s existing proved plus probable booked reserves,” he said.
In addition to the acquisition of Shell India’s entire stake in Rajasthan, Cairn has secured a three-year extension to the exploration term of the block, on which there have been two previous oil discoveries, including the potentially commercial Saraswati discovery.
This initial programme is due to commence in late 2002 and will comprise appraisal drilling on saraswati, an exploration well in the greater Saraswati area and an additional exploration well on the Central Basin High, the statement said.
Cairn has received formal government approval of the commerciality of the Gauri gas field and intends to proceed to further delineate and develop Gauri gas.
Development wells on Gauri will be deepened to appraise the oil reservoirs, Murray said.
A three-well appraisal drilling campaign to determine the commerciality of Lakshmi Oil is scheduled for late 2002-early 2003.