Cairn deputy CEO Prachur Sah told the news agency that the investment forms part of the company’s $4-5bn capital expenditure planned over the next three to four years.
Sah said: “The board has approved an investment of $700m out of this for FY23 on activities related to exploration drilling, in-field drilling at Mangala-Bhaghyam-Aishwarya (MBA) field, and new blocks.”
The firm plans to invest in its 100 exploratory wells located in the country. These include the pilot project for shale oil/gas in the Barmer region, in the Indian state of Rajasthan.
As part of this plan, the oil and gas exploration and production company has appointed Schlumberger and Halliburton to prepare a detailed report on in-place shale reserve estimates, and ways to put forward production activities.
Sah added: “Going by initial estimates, there are in-place shale reserves of around three to four billion barrels [in the Barmer region]. Although the entire reserves are not recoverable, even if we take typical industry recovery of 10%, it will be 300-400 million barrels of hydrocarbon.”
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For the quarter that ended 31 December 2021, Cairn reported an average daily production of 159,000 barrels of oil equivalent.
With the planned investments, the firm intends to triple this production capacity in the next three years.
Cairn plans to begin the pilot for shale by this June, followed by drilling for at least three to four months, to assess its commercial viability.
“By the end of 2022, we will get a fair idea of the reserves. The investments could increase with successful discoveries,” Sah added.
Last year, Cairn Energy offloaded its interests in the Catcher and Kraken fields, in the UK North Sea, to Waldorf Production for $455m.