Wed, 24 Apr 2024
20:44:10
No Oil?:
26 Dec 2011
20:52:03
Nothing in the Third Oil Well of Cairn
Dec 26, 2011 (SLBO) - The one and only Oil and Exploration company so far set up in Sri Lanka, Cairn Lanka, a subsidiary of Cairn India, had notified the government of Sri Lanka of its intention to enter the second phase of exploration after the third well drilled in the North Western coast of the island CLPL-Dorado North 1-82K/1 was plugged and abandoned as a dry hole on 14th December, 2011.
Thus the campaign had now come to an end after its third test well found no oil or gas.
A statement by the company said that Cairn Lanka (Private) Limited, a wholly owned subsidiary of Cairn India Limited, has successfully completed the first phase of the exploration campaign in Sri Lanka Block SL-2007-01-001.
The exploration programme involved the acquisition, processing and interpretation of 1,753 sq km of 3D seismic data and a three well deep water drilling programme. Company had further said that the seismic programme exceeded the phase I commitment by 20% and the drilling programme exceeded the drilling depth commitment by 50%.
The drilling programme had resulted in two successive gas and condensate discoveries: the CLPL-Dorado-91H/1z well and, the CLPL-Barracuda-1G/1 well.
Company is its statement said that the operations were conducted safely, in accordance with the highest global standards, within schedule, budget and in compliance with Sri Lankan regulations.
Cairn Lanka's successful drilling programme - the first in Sri Lanka in 30 years - has established a working petroleum system in the frontier Mannar Basin.
According to the statement following this success, Cairn Lanka has notified the government of Sri Lanka of its intention to enter the second phase of exploration.
It also noted that the support of the Government of Sri Lanka and an effective partnership with the relevant authorities in Sri Lanka, were instrumental in ensuring the successful completion of the first phase exploration programme.
Early August this year Cairn Lanka started its drilling operations in Sri Lanka whilst founding company of Cairn India, UK-based Cairn Energy Plc ended this year's US$ 600 million drilling program off Greenland after the biggest exploration campaign attempted in the Arctic island's waters failed to make a viable discovery.
Both arctic and Sri Lanka's Mannar Basin are frontier basins that is said to be holding billions of barrels of oil which are yet to be taken out from reserves. International studies reveal that Greenland offshore has the potential to produce 44 billion barrels of recoverable oil whilst former Director General (DG) of Petroleum Resources Development Secretariat (PRDS) in Sri Lanka Neil De Silva had earlier said Sri Lanka can produce over 1 billion barrels of oil if drilling results are successful.
However there had been no updates on the progress of the discoveries from Cairn Lanka's third well whilst mid November Cairn Lanka (Private) Limited, a wholly owned subsidiary of Cairn India Limited, has notified the appropriate authorities in the Government of Sri Lanka of a Gas Discovery in the CLPL-Barracuda-1G/1 well; the second well, located in the block SL 2007-01-001, in Mannar Basin.
That time it was informed that the second well was drilled to a total depth of 4741metres(m) in water depth of 1509m and encountered 24m of hydrocarbon bearing sandstone in three zones between the depths of 4067m and 4206m.
"The reservoirs are predominantly gas bearing with some additional liquid hydrocarbon potential" Cairn notified.
Meanwhile later Cairn said that it will evaluate the well results and work with appropriate authorities to determine the commercial potential of its both discoveries in its first well and third well.
The CLPL-Barracuda-1G/1 well is the second successive discovery, located 38 kilometres (km) west of the CLPL-Dorado-91H/1z discovery well and approximately 68 km from the Sri Lanka coastline.
However in November 2011 Cairn said that an update on the well results will be provided after the end of the programme, which is expected to be complete by early next year.
In early December London listed Mining group Vedanta Resources completed the long delayed acquisition of oil producer Cairn Lanka's parent company Cairn India Ltd, after 16 months of protracted wrangling over royalty payments.
On the acquisition Vedanta paid US $ 8.67 billion for 58.5% stake in Cairn India and it was termed as the the third largest acquisition ever by an Indian enterprise globally; that gives Vedanta control of nation's biggest onshore oilfield in Rajasthan and 9 other properties in India and one in Sri Lanka where a gas discovery was made recently.
While the transaction was proposed in August 2010, the Indian government approved of the deal on June 30 this year on condition that Cairn/Vedanta pay a share of royalties and oil cess on the Cairn's crownjewel Rajasthan oil fields.
However Financial Chronicle in its report of 9 December, pointed out that it is a silent coup by a shrewd Indian businessman from Patna. While the transaction marks Vedanta's entry into the oil and gas sector, with the potential to enhance and grow opportunities for the group. The acquisition of Cairn India enhances and diversifies Vedanta's growth pipeline and Agarwal had already set a target of doubling capacity at Cairn India to 300,000 barrels a day immediately according reports in India.
Vedanta is the world's largest integrated producer of zinc-lead. Born in Patna in 1954, Agarwal began his business as a scrap-metal dealer. In 1986 he ventured into the business of jelly-filled cables. Realising that there was a shortage of copper, a raw material for the cable business, Agarwal thought of producing copper. In 1999, he started manufacturing copper rods. He went to Australia to learn about the technology of copper smelting, and from there, flew to the west coast to buy a sick plant. In 2000 Agarwal bought two mines in Australia and one in Africa. When the Indian government announced a disinvestment plan, he successfully bid for Bharat Aluminium (Balco) and picked up 51 per cent for Rs 550 crore. He then invested Rs 4,000 crore in its modernisation. In 2003 he included all his business units under Vedanta Resources and listed it on the London Stock Exchange.
Agarwal's largest investment in Odisha of US$ 12 billion for an aluminium project is stuck due to environmental issues. Early in 2010 the Church of England sold its stake in Vedanta in protest against the company's 'level of respect for human rights', referring to Vedanta's 'irresponsible ways' to mine bauxite in Odisha.
Vedanta has been criticised by human rights and activist groups, including Survival International and Amnesty International, due to their operations in Niyamgiri Hills in Orissa, India that are said to threatened the lives of the Dongria Kondh that populate the region.The Niyamgiri hills are also claimed to be an important wildlife habitat in Eastern Ghats of India as per a report by the Wildlife Institute of India.
In Sri Lanka Mannar Basin is located on the southeastern tip of the subcontinent, the Gulf of Mannar is known to harbour over 3,600 species of flora and fauna, making it one of the richest coastal regions in Asia. 117 hard coral species have been recorded in the Gulf of Mannar. Sea turtles are frequent visitors to the gulf as are sacred sharks, dugongs, and dolphins. However, the combined effects of 47 villages, with a total population of around 50,000 has meant that overharvesting of marine species has become a problem. Fish catches have declined, as have pearl oyster, gorgonian coral, and acorn worm populations. Local fishermen rely on the reef to feed their families, but destructive fishing methods combined with the stress of pollution and coral mining have meant both nearshore and offshore catches have decreased.
Sri Lanka which had already been in the spotlight of the Human Rights and activist groups after winning its war over terrorism; now Vedanta being behind the oil drilling activities in Gulf of Mannar the repercussions that the island nation will face are yet be seen as an untouched area of concern according to experts.
Devendra Francisco the Writer of this article is an Expert Analyst in International Oil & Gas Industry, Politics and Insights.
Thus the campaign had now come to an end after its third test well found no oil or gas.
A statement by the company said that Cairn Lanka (Private) Limited, a wholly owned subsidiary of Cairn India Limited, has successfully completed the first phase of the exploration campaign in Sri Lanka Block SL-2007-01-001.
The exploration programme involved the acquisition, processing and interpretation of 1,753 sq km of 3D seismic data and a three well deep water drilling programme. Company had further said that the seismic programme exceeded the phase I commitment by 20% and the drilling programme exceeded the drilling depth commitment by 50%.
The drilling programme had resulted in two successive gas and condensate discoveries: the CLPL-Dorado-91H/1z well and, the CLPL-Barracuda-1G/1 well.
Company is its statement said that the operations were conducted safely, in accordance with the highest global standards, within schedule, budget and in compliance with Sri Lankan regulations.
Cairn Lanka's successful drilling programme - the first in Sri Lanka in 30 years - has established a working petroleum system in the frontier Mannar Basin.
According to the statement following this success, Cairn Lanka has notified the government of Sri Lanka of its intention to enter the second phase of exploration.
It also noted that the support of the Government of Sri Lanka and an effective partnership with the relevant authorities in Sri Lanka, were instrumental in ensuring the successful completion of the first phase exploration programme.
Early August this year Cairn Lanka started its drilling operations in Sri Lanka whilst founding company of Cairn India, UK-based Cairn Energy Plc ended this year's US$ 600 million drilling program off Greenland after the biggest exploration campaign attempted in the Arctic island's waters failed to make a viable discovery.
Both arctic and Sri Lanka's Mannar Basin are frontier basins that is said to be holding billions of barrels of oil which are yet to be taken out from reserves. International studies reveal that Greenland offshore has the potential to produce 44 billion barrels of recoverable oil whilst former Director General (DG) of Petroleum Resources Development Secretariat (PRDS) in Sri Lanka Neil De Silva had earlier said Sri Lanka can produce over 1 billion barrels of oil if drilling results are successful.
However there had been no updates on the progress of the discoveries from Cairn Lanka's third well whilst mid November Cairn Lanka (Private) Limited, a wholly owned subsidiary of Cairn India Limited, has notified the appropriate authorities in the Government of Sri Lanka of a Gas Discovery in the CLPL-Barracuda-1G/1 well; the second well, located in the block SL 2007-01-001, in Mannar Basin.
That time it was informed that the second well was drilled to a total depth of 4741metres(m) in water depth of 1509m and encountered 24m of hydrocarbon bearing sandstone in three zones between the depths of 4067m and 4206m.
"The reservoirs are predominantly gas bearing with some additional liquid hydrocarbon potential" Cairn notified.
Meanwhile later Cairn said that it will evaluate the well results and work with appropriate authorities to determine the commercial potential of its both discoveries in its first well and third well.
The CLPL-Barracuda-1G/1 well is the second successive discovery, located 38 kilometres (km) west of the CLPL-Dorado-91H/1z discovery well and approximately 68 km from the Sri Lanka coastline.
However in November 2011 Cairn said that an update on the well results will be provided after the end of the programme, which is expected to be complete by early next year.
In early December London listed Mining group Vedanta Resources completed the long delayed acquisition of oil producer Cairn Lanka's parent company Cairn India Ltd, after 16 months of protracted wrangling over royalty payments.
On the acquisition Vedanta paid US $ 8.67 billion for 58.5% stake in Cairn India and it was termed as the the third largest acquisition ever by an Indian enterprise globally; that gives Vedanta control of nation's biggest onshore oilfield in Rajasthan and 9 other properties in India and one in Sri Lanka where a gas discovery was made recently.
While the transaction was proposed in August 2010, the Indian government approved of the deal on June 30 this year on condition that Cairn/Vedanta pay a share of royalties and oil cess on the Cairn's crownjewel Rajasthan oil fields.
However Financial Chronicle in its report of 9 December, pointed out that it is a silent coup by a shrewd Indian businessman from Patna. While the transaction marks Vedanta's entry into the oil and gas sector, with the potential to enhance and grow opportunities for the group. The acquisition of Cairn India enhances and diversifies Vedanta's growth pipeline and Agarwal had already set a target of doubling capacity at Cairn India to 300,000 barrels a day immediately according reports in India.
Vedanta is the world's largest integrated producer of zinc-lead. Born in Patna in 1954, Agarwal began his business as a scrap-metal dealer. In 1986 he ventured into the business of jelly-filled cables. Realising that there was a shortage of copper, a raw material for the cable business, Agarwal thought of producing copper. In 1999, he started manufacturing copper rods. He went to Australia to learn about the technology of copper smelting, and from there, flew to the west coast to buy a sick plant. In 2000 Agarwal bought two mines in Australia and one in Africa. When the Indian government announced a disinvestment plan, he successfully bid for Bharat Aluminium (Balco) and picked up 51 per cent for Rs 550 crore. He then invested Rs 4,000 crore in its modernisation. In 2003 he included all his business units under Vedanta Resources and listed it on the London Stock Exchange.
Agarwal's largest investment in Odisha of US$ 12 billion for an aluminium project is stuck due to environmental issues. Early in 2010 the Church of England sold its stake in Vedanta in protest against the company's 'level of respect for human rights', referring to Vedanta's 'irresponsible ways' to mine bauxite in Odisha.
Vedanta has been criticised by human rights and activist groups, including Survival International and Amnesty International, due to their operations in Niyamgiri Hills in Orissa, India that are said to threatened the lives of the Dongria Kondh that populate the region.The Niyamgiri hills are also claimed to be an important wildlife habitat in Eastern Ghats of India as per a report by the Wildlife Institute of India.
In Sri Lanka Mannar Basin is located on the southeastern tip of the subcontinent, the Gulf of Mannar is known to harbour over 3,600 species of flora and fauna, making it one of the richest coastal regions in Asia. 117 hard coral species have been recorded in the Gulf of Mannar. Sea turtles are frequent visitors to the gulf as are sacred sharks, dugongs, and dolphins. However, the combined effects of 47 villages, with a total population of around 50,000 has meant that overharvesting of marine species has become a problem. Fish catches have declined, as have pearl oyster, gorgonian coral, and acorn worm populations. Local fishermen rely on the reef to feed their families, but destructive fishing methods combined with the stress of pollution and coral mining have meant both nearshore and offshore catches have decreased.
Sri Lanka which had already been in the spotlight of the Human Rights and activist groups after winning its war over terrorism; now Vedanta being behind the oil drilling activities in Gulf of Mannar the repercussions that the island nation will face are yet be seen as an untouched area of concern according to experts.
Devendra Francisco the Writer of this article is an Expert Analyst in International Oil & Gas Industry, Politics and Insights.
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