آ“We are waitingآ”: ONGC on Rajasthan block

Vol 4, PW 1 (16 Feb 00) Exploration & Production
     

Senior ONGC officials are keeping a close watch on developments at a concession in Rajasthan operated by Cairn Energy in partnership with Shell.

We are waiting for an announcement that the discovery is commercial, a senior ONGC official reveals, Until we hear it is commercial it would not be judicious to speculate on whether we want to exercise our option to enter the consortium. In its contract with Cairn Energy and Shell, ONGC has first right of refusal to exercise a 30% participating stake in the 11,400 square km RJ-ON-90/1 block in the Rajasthan desert.

Cairn (operator) and Shell presently hold 50% equity in the concession. If ONGC decides to join the equity stakes would be scaled down to 35% for Cairn, 35% for Shell and 30% for ONGC.

For the moment, though, ONGC (the licensee) is keeping its future intentions secret, despite the fact that Cairn has openly stated its ambition to commercialise the concession. The oil ministry is also believed to be putting pressure on ONGC to exercise its 30% option.

Cairn, meanwhile, is examining technical bids for a fresh seismic 2D and 3D seismic survey, which it hopes to begin in March, soon after commercial bids are submitted. On 15th August last year, Shell confounded sceptics with news that its Guda-2 well in its RJ-ON-90/1 concession flowed 2,000 barrels a day (b/d) with no water.

After the strike, Cairn Energy assumed operatorship and increased its stake from 27.5% to 50%. In its interim report, Cairn says Guda-2, will be completed as a future producer.

The oil-bearing zone at Guda-2 is believed to be two metres thick. An initial assessment of the crude puts it at between 35-38 API, with no nitrogen or hydrogen sulphate.