Tuesday, March 5, 2024
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HomeTechnologyCairn to start drilling 4 blocks in Assam next month: deputy CEO...

Cairn to start drilling 4 blocks in Assam next month: deputy CEO | Company News – Business Standard

Cairn Oil & Gas will embark on a new venture in Assam next month.

In the initial phase, the company will drill 10 wells in four hydrocarbon blocks, located along the Assam-Arunachal and Assam-Nagaland borders, Stephen Moore, joint chief executive officer (CEO), revealed in an interview with Business Standard, on the sidelines of India Energy Week 2024.

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With an expected average success rate of 40 percent, the company plans to have two rigs in operation in Assam, for drilling and evaluation, Moore said.

Moore explained the company’s strategy in the event of a discovery. “When there is no uncertainty, you can develop it. But then you need development platforms. We are going to drill 20 wells in that field. If there is uncertainty, we will dig 2 or 3 evaluation wells. As we move through this sequence of platforms, we will mobilize a second platform,” he said. This approach, he added, would accelerate the financial realization of the project.

Cairn has 7,650 km² of area with 12 Open Area License Policy (OALP) blocks and three Discovered Small Field (DSF) blocks in the Arakan Basin of Assam. The surface has significant resource potential of up to one billion barrels of oil equivalent. It became the first company to start gas flow from a DSF block in Assam last year when the Hazarigaon field came online.

Enough platforms available

The project, which was expected to begin in February, has suffered delays due to a lack of high-quality land platforms. Moore noted that the problem is not a shortage of land rigs in India, but rather their quality. “Preferably we need local companies to invest in world-class platforms,” ​​he said.

Land platforms are used to identify geological deposits and extract oil or natural gas from them efficiently.

Despite the lack of availability of land rigs globally, with Saudi Arabia and Abu Dhabi procuring large quantities, Moore assured that Cairn has enough options for the Assam project, having received seven offers for rigs after approaching the market.

New technology used

Cairn plans to deploy modern seismic analysis and processing technology to navigate the complex geology of the northeast. Most of the Cairn blocks are located in the folded thrust belt, such as that of Kurdistan (Iraq), Italy and Albania, Moore said.

The company has large-scale aerial full tensor gradiometry (FTG) surveys that measure the rate of change of gravity in all directions of the field, caused by subsurface geology. “This is better than pure magnetic gravity studies and gives a much clearer picture of what the structural trends are at the basement level,” he said.

Fracking will not be necessary in Assam as the wells are deep. Instead, the company will use long horizontal and multilateral drilling, along with coiled tubing drilling, a popular technique in West Asia, Moore said.

Despite these challenges, Hitesh Vaid, chief financial officer of Cairn Oil & Gas, assured that the extraction cost per unit in the northeast is not higher compared to other areas like Rajasthan. Cairn aims to leverage technology to improve efficiency, in contrast to public sector national oil companies such as ONGC and Oil India, which often use outdated platforms.

In other developments, Cairn is not planning an expansion of processing capacity at Rajasthan’s Barmer. Instead, the company will leverage existing facilities to produce more. “Of course, we continue to drill more wells to ensure that production does not decline,” Vaid added.

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