Cairn persists with disappointing KG-OS-6

Vol 7, PW 16 (22 Oct 03) Exploration & Production

Persistence is a quality in ample supply at Scottish explorer Cairn Energy's India operations.

Undeterred by its frustrating drilling experience at eastern offshore Krishna Godavari block KG-OS-6, Cairn has set 1st December to re-drill a well it had to abandon two years ago. PETROWATCH learns Cairn has hired Atwood Oceanics' semi-submersible rig Atwood Southern Cross for a one 'firm' and two 'optional' well programme.

Drilling of the 'optional' wells will depend on the re-entry results of well KG-6-1. Atwood Southern Cross will sit in water depths of between 600 to 800 feet and drill to a target depth of about 2,500 metres.

A source tells this report the rig has been hired for an 88-day drilling programme at an effective day rate of about $60,000 inclusive of a mobilisation fee of about $2m and a demobilisation fee of about $1m. Atwood Southern Cross is currently offshore Egypt from where she set sail for India last week.

Block KG-OS-6 is the odd one out in Cairn's string of exploration successes in India. Cairn is currently in the second extension to 'Phase-II' of the exploration programme at KG-OS-6.

The first extension ended in June 2003, but Cairn asked for and received another eight-month extension to 'Phase-II' after impressing the DGH with its determination to surmount the geological, sub-surface problems it faced while drilling. Against a commitment to reprocess 2,000-km old 2D seismic and shoot 700-km fresh 2D during the exploration phase of the PSC, Cairn has till date reprocessed 6,000-km old 2D and shot 4,000-km fresh 2D as well as 760-sq km fresh 3D.

Of three exploration wells committed in the six-year PSC, two have already been drilled, including well KG-6-1 that Cairn will re-enter with Atwood Southern Cross. Cairn's current extension and the earlier one have been subtracted from the period available for 'Phase-III', which ends in June next year.

Cairn has to decide well before then whether it wants to proceed to 'Phase-III'.

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