Cairn wants $102m polymer Mangala facility

Vol 17, PW 3 (05 Sep 13) Exploration & Production

Cairn India is betting that a proposed polymer flooding facility at Mangala in Rajasthan will result in an additional 70m barrels of oil.

Cairn’s partner ONGC and the DGH are examining a plan to set up ‘concentrated polymer facilities’ to inject chemicals into Mangala’s reservoir to boost production. Setting up the polymer facility should cost $102m but the total cost of the project is $601m.

Cairn’s Mangala, Bhagyam and Aishwariya fields together produce 180,000 b/d of waxy crude. Reserve figures for Mangala are unavailable but polymer injection could increase recoverable reserves from Rajasthan block RJ-ON-90/1 by 4% from current levels of 1.7bn barrels of oil equivalent.

Cairn’s plan for the polymer facility, submitted in July, is the result of an exercise that began last year when Cairn invited EoIs to implement Enhanced Oil Recovery techniques at Mangala. Cairn hopes to have the polymer facility ready by April next year and produce an additional 70m barrels of oil by 2020.

An industry source says the project will yield an impressive 38% Internal Rate of Return (IRR), assuming crude at $80/barrel, well above the 14% minimum rate ONGC wants. Cairn’s facility will inject polymers into the reservoir using new pipelines connected to 15 well pads.

Water injection pipelines will feed polymers into 93 wells: 69 water injectors and 24 oil-producers.

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