Oil India believed to be interested in BP Birbhum block

Vol 12, PW 26 (04 Jun 09) Exploration & Production
     

Until now Oil India hasn’t had any success getting a foothold in the Coal Bed Methane (CBM) exploration business in India.

During the last round for 10 blocks it bid, but ultimately won nothing. That could soon change if, as rumoured, Oil India farms-in to the BB-CBM-2005/III block in the Birbhum district of West Bengal, operated by BP with 100%.

Nothing is confirmed, and being commercially sensitive, BP and Oil India naturally decline to comment. But this report learns BP is ready to part with up to 50% of the block and that Oil India is the most interested to date.

“Oil India is evaluating the data,â€‌ confirms a well-placed source. “But it hasn’t made up its mind.

â€‌ Has BP set a bid deadline “BP has not given any timeline for bids,â€‌ he adds. “I can’t say more than that.

â€‌ BP, as we know already, sent offer letters to most E&P companies in India, not just those involved in CBM exploration and obvious candidates like Australia’s Arrow Energy the two Reliance companies (Anil and Mukesh), Essar and ONGC. “BP is lucky that Oil India is interested,â€‌ adds a second source.

“Oil India wants to get into CBM exploration.â€‌ Aside from Oil India, Reliance (Mukesh) is also believed to be showing interest and viewing data.

But Arrow Energy, one of the first companies rumoured to be interested, has apparently lost interest, for reasons unknown. Arrow, we hear, “is not keeping track any longer.

â€‌ On site at Birbhum, meanwhile, we hear BP spud the first of eight planned core-holes on or around April 20 using a CBM drilling rig from Mitchell Drilling. One unconfirmed report is that routine equipment problems might have forced a minor delay.

By June 2, as we go to press, the corehole had still not been completed, confirms a driller. Contacted by this report, BP maintains that all is going to schedule.

“Everything is on track and there is no problem at the block,â€‌ says BP.