Essar Oil and Gas Exploration and Production Ltd. (EOGEPL) , the upstream exploration and production arm of Essar, would invest ₹900 crore to increase its CBM (coal bed methane) production at Ranigunj in West Bengal, according to a top official.
“We will now focus on production, which we plan to double within the next three to four years, from one million standard cubic metre (scm) daily now. In addition to the 350 wells, 150 more would be sunk”, said Vilas S. Tawde , CEO, EOGEPL.
Only 0.6 scm of the 1.5 million scm CBM gas produced has found buyers with most of the balance production being flared. However, for EOGEPL, at least this problem may not be a source of worry with GAIL recently winning a bid to buy the block’s entire production for the next 15 years.
The State-run gas firm had won the rights to buy up to 2.3 million metric scm per day of CBM from Ranigunj.
“We expect to sign this contract in mid-March,” Mr. Tawde told The Hindu, adding that GAIL would also get to use the existing facilities like pipelines and metering. Essar had already invested ₹4,000 crore in this project.
Despite being the first CBM block to cross the 1 million scm of production per day, about ₹400 crore worth of gas had to be flared over the last few years for want of buyers.
Gas grid
However, Essar is also awaiting the completion of the Urja –Ganga gas grid which would enable pipeline connectivity from Phulpur in Uttar Pradesh to Durgapur via Jamshedpur, Dhanbad, Kolkata and Haldia.
Essar currently has exploratory blocks in West Bengal’s Rajmahal and Sohagpur and Ib and Talcher Valley in Odisha. It also has shale gas asset in Ranigunj where an exploratory and production programme is in place.
