Page 6 - AsianOil Week 45
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India extends Cairn’s PSC for Ravva block
PROJECTS & COMPANIES
THE Indian government has extended Cairn Oil & Gas’ production-sharing contract (PSC) for the Ravva block in Andhra Pradesh State by 10 years until 2029, the company said on November 6.
The company said the offshore block was the first large field to receive an extension under a government policy focusing on extending field licences controlled by private joint ventures.
Cairn owns a 22.5% operated interest in Ravva field, which is part of Block PKGM-1 in the Krishna Godavari (KG) Basin. State-owned Oil and Natural Gas Corp. (ONGC) has a 40% stake, while Videocon Petroleum owns 25% and Ravva Oil holds 12.5%.
The independent said the extension would allow the JV partners to recover around 13mn barrels of oil equivalent (boe) under a “do nothing” scenario. However, the partners intend to invest around INR5.5bn ($76.7mn) to drill seven wells under a revised field development plan (RFDP). The plan aims to tap an additional 11.7mn boe of reserves and, according to Cairn, the block has an exploration potential of around 60mn boe.
Production at the field has been declining steadily in recent years and the added investment is key to improving its performance. Output in the financial year 2018-2019 shrank 13% year on year to around 14,900 barrels of oil equivalent perday(boepd).
Cairn’s CEO, Ajay Kumar Dixit, said: “Fast-tracking decision-making will help quicker and timely recovery of these additional reserves. Ravva is a fine example of augmenting production in an ageing oilfield with the help of the most advanced technological interventions in the industry globally. Our endeavour is to make Ravva a global case study for enhanced recoveryinanageingoilfield.”
The company has introduced a number of technologies at the block over the years, including 4D seismic, e-line tractor and stoker base milling operations and pro- duced water reinjection.
While the field was initially estimated to pro- duce 100mn barrels of crude oil, Cairn said it had yielded 295mn barrels of oil and 418bn cubic feet (11.84 bcm) of gas as of October 31. ONGC discovered the field in 1987 and brought it on stream in 1993, before the government signed a 25-year contract with the current JV partners in 1994.
Commenting on the extension, the chairman of Cairn parent Vedanta Resources, Anil Agar- wal, said: “We look forward to working with all our partners towards achieving our vision of contributing 50% of the country’s domestic pro- duction and supporting the government in its energysecuritygoals.”
IOC makes first IMO-compliant bunker sale
PROJECTS & COMPANIES
STATE-RUN Indian Oil Corp. (IOC) has completed the country’s first bunker sales of very low-sulphur fuel oil (VLSFO) ahead of the introduction of new international mari- time fuel standards.
India’s largest refiner said on November 7 that it had sold the fuel to the tanker MV UACC Ras Tanura in Kochi Port and another vessel at Kandla Port.
The company intends to begin delivering bunker fuel to the ports of Mumbai, Mangaluru, Tuticorin, Chennai, Visakhapatnam, Paradip and Haldia by mid-November, it added.
IOC is the country’s first refiner to start deliv- ering marine fuel that meets the International Maritime Organisation’s (IMO) new guidelines on sulphur content that will be introduced on January 1, 2020. The IMO-rules will require the global tanker fleet to use fuel with a sulphur content of no more than 0.5% – down from the current cap of 3.5%.
Despite the refiner being able to ramp up production and supply of IMO 2020-compliant fuel ahead of the deadline, the country’s regula- tor has already moved to appease the country’s
shipping sector with promises of a more relaxed approached to the cap.
The Indian Mercantile Marine Department’s deputy nautical advisor, SIAK Azad, told an industry conference in Chennai on November 5 that the regulator would prioritise ease of doing business in the first few months of the new rules.
Azad said the regulator was adopting the more relaxed approach as it gauged not just shippers’ readiness to switch to the cleaner fuel standard but also oil marketing companies’ (OMCs) ability to meet demand.
“As port state control, we understand that the situation will be complex in the first few months. Trust and common sense will be applied and we won’t go just by the letter of the law,” he told attendees.
IOC’s chief technical service manager, Anil Vasu, told the same conference that while India’s total bunker fuel requirement was around 1.7mn tonnes per year, IOC’s refinery in Koyali had built 1mn tpy of compliant fuel processing capacity. Vasu said shipments of IMO-compliant fuel to eastern ports would begin in the coming weeks.
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w w w . N E W S B A S E . c o m Week 45 13•November•2019
