Cairn India gets govt nod for Rajasthan pipeline

Oil exploration firm Cairn India today said it has got government approval to build a pipeline to transport crude oil from its fields in Rajasthan to refiners. Cairn received permission to use land (right of use) for laying a 582-km pipeline from Barmer district of Rajasthan to Salaya in Gujarat, Cairn India CEO Rahul Dhir said. “We have started the RoU process,” he said. He also said that the company was committed to delivering first oil from the Rajasthan fields in 2009. “We will begin production from Mangala (the largest of the 18 discoveries in the Rajasthan block) in 2009.

However, Cairn is still awaiting a government approval to allow the cost of the $780-million pipeline to be recoverable from field revenues, as other project costs are. “We are confident about approval of inclusion of the pipeline in the Field Development Plan,” Dhir said. The Mangala field will be brought on production first followed by the Bhagyam and Aishwariya fields and the targeted gross plateau production from these three fields is 150,000 barrels per day by 2010.

“By end of 2009, output from Rajasthan fields would be 100,000 barrels per day,” he said. Almost simultaneously to the pipeline’s inclusion in FDP would come the nod for selling the crude oil to multiple refiners instead of suppling it to Mangalore Refinery.