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Mangala output can be raised to 150,000 bpd: Cairn

Cairn India Chairman Bill Gammell told company shareholders that the field could produce 20 per cent more from the current 1,25,00 barrels per day.

twitter-logo PTI   Mumbai     Last Updated: September 15, 2010  | 18:34 IST

Cairn India Ltd, the energy firm that London-listed Vedanta Resources is seeking to buy, on Wednesday said the giant Mangala oilfield in Rajasthan can produce 1,50,000 barrels of oil per day (bpd), 20 per cent more than the previously approved peak production.

Mangala is the first of the 25 oil and gas discoveries Cairn has made in the prolific Rajasthan block. The largest oil find in the country in more than two decades, it has an approved plateau production of 1,25,000 bpd (6.25 million tonnes) and, together with the Bhagyam and Aishwariya fields in the block, is slated to produce 1,75,000 bpd (8.25 million tonnes).

Today, the Mangala field in Rajasthan is producing 1,25,000 bpd, with the ability to go above that level from the Mangala field alone, Cairn India Chairman Bill Gammell told company shareholders here.

Gammell, who is also the Chief Executive of UK's Cairn Energy Plc, which holds a 62.38 per cent stake in Cairn India, said the production can be quickly ramped up to 1,50,000 bpd (7.5 million tonnes).

"The results from the ongoing development drilling campaign in the Mangala field confirm the excellent reservoir quality of the Fatehgarh Formation, to support an increase in the production potential to 1,50,000 bpd, subject to the government's approvals," he said.

"The current estimate of the resource base in Rajasthan provides a basis for our vision to produce at least 2,40,000 bpd (12 million tonnes a year) from the block, subject to regulatory approvals and additional investments," he said.

The output would be equivalent to what state-owned Oil and Natural Gas Corp's prime Mumbai High field in the Western Offshore produces.

Cairn has commissioned three plants that can process 1,25,000 bpd of crude oil, pumped out from wells in the Rajasthan block before dispatching them to refiners. A 590-km crude oil pipeline from Barmer to Salaya, in Gujarat, carries the Mangala crude to Reliance Industries, Essar Oil and Indian Oil Corp for processing.

The Mangala field in the Thar desert of Rajasthan was discovered in January 2004 and put to production in August last year.

Gammell said Vedanta Resources has made an offer to buy an up to 51 per cent stake in Cairn India for $8.48 billion.

"As of now, the proposed transaction has not been closed and is subject to consents and approvals in India and in the United Kingdom," he said.

Cairn India's "vision is to take the production in Rajasthan to at least 2,40,000 bpd, subject to further investment and approvals," Gammell said. "I would say this is an exciting and transformational time for your company.

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