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Indian oil exploration gets multi-billion dollar boost

22nd August 2012

Cairn India makes multi-billion dollar investments in oil exploration as part of increasing the energy hungry country’s domestic output

Cairn India will spend approximately USD 600 million on exploration activities in Rajasthan

Indian energy giant Cairn plans to spend USD 2 billion (around Rs. 11,000 crore) by 2014 on exploration activites, it emerged this week. The announcement comes as part of wider plans to ramp up the country’s domestic energy sources and ease its dependence on imports

Around USD 600 million of total funds will be spent on exploration activities in Rajasthan, company chairman Navin Agarwal said at Cairn’s annual general meeting this weel.

“Crude oil production from the Rajasthan block touched 175,000 barrels of oil per day…The resource base for the block is now estimated at 7.3 bn barrels of oil equivalent in-place—an increase of over 11 per cent,” he said.

The company has already made the largest onshore oil discovery in India, but the increased activity in exploration looks set to bring greater finds.

 “Based on revised estimates, the total Rajasthan resource base now supports a potential production of 300,000 barrels of oil per day, subject to approvals from the government of India and our joint venture partner, the Oil and Natural Gas Corp. Ltd and further investments,” Agarwal said in a note.

The oil ministry says the country’s energy demand is expected to more than double by 2035, from less than 700 million tonnes of oil equivalent (mtoe) today to around 1,500 mtoe.

India currently imports as much as 80 per cent crude and 25 per cent natural gas to fuel its growing appetite for fuel. The country is currently the world’s fourth largest consumer of energy, after the US, China and Russia.

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