Four Ravva discoveries ready for development

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

High oil prices have convinced the oil ministry it's time to let Cairn India develop four discoveries at the Ravva oil and gasfield.

PETROWATCH learns the oil ministry exploration division prepared a note last month (August) seeking oil secretary Vivek Rae’s approval for Cairn to develop discoveries RX-1, RX-3, RX-8Z and R-13. In July Cairn submitted a fresh Declaration of Commerciality (DoC) and Field Development Plan (FDP) for the discoveries, earlier believed to be commercially unviable.

But new benchmark oil prices used by the ministry show the government could get $20m in royalties and $150m in net profit by the time the PSC ends in October 2019. Assuming crude at $100/barrel and gas at $3.5/mmbtu, ministry officials calculate the four wells will generate gross revenue of $251m over the project’s life.

These calculations are based on DGH estimates Ravva can produce 4.29m barrels of crude and 500m cubic metres (17.66bn cubic feet) of gas by 2025. “If we estimate this field will produce more than 90% by the time the PSC ends,” says a government source, “then the project is commercially viable.

” Documents provided to the DGH by Cairn show RX-1 flowed 4200 b/d and 73 cm/d while testing in 1999; RX-3 flowed 24m cf/d (679,886 cm/d) while testing in 2000; RX-8 flowed 2368 cf/d (67 cm/d) while testing in 2007; and RX-13 flowed 1239 b/d while testing in 1998.