Six-month delay in CBM production from Raniganj

Vol 12, PW 5 (24 Jul 08) Exploration & Production

Commercial production of Coal Bed Methane from Raniganj East in West Bengal is likely to be delayed by at least six months to the end of 2008.

PETROWATCH hears operator Essar Oil had planned to begin commercial production by the end of May this year but that late receipt of environmental clearance and the early arrival of monsoon rains have upset plans. “We began the test wells late by a few months,â€‌ reports Essar.

“Environmental clearance was received only two months back and because the rains came in early we had to delay drilling.â€‌ Essar has deployed two onland rigs at the block: one owned by the company, the other hired.

“We have finished drilling three test wells and are now drilling the fourth,â€‌ adds Essar. Essar is committed to drilling 15 test wells to depths of between 1200 and 1300 metres each and hopes to complete the programme by September or October this year.

After drilling eight test wells, Essar says it will begin the de-watering and hydrofracturing process, using equipment hired from ONGC. In parallel to the hydrofracturing process, Essar wants to begin drilling multilateral wells, but this is yet to be finalised.

Essar’s 15 test wells at Raniganj East will form the nucleus of its future production operation. “First commercial supplies of gas will begin immediately after we finish the test wells, anytime between October and December,â€‌ we hear.

“Each well could start off with 5000 cm/d and then increase gradually.â€‌ Essar has no immediate plans to sign long term commercial contracts for CBM until it can forecast stable production numbers.

“No big customer will commit to take CBM until we can commit to produce a certain daily amount,â€‌ continues Essar. “Just as we will insist on â€کtake-or-pay’, the buyers will insist on â€کsell-or-pay’ clauses in the contract.

â€‌ Essar expects first sales of its CBM as CNG or to small businesses in and around Raniganj, a city and municipality in the Bardhaman district of West Bengal.