NEW DELHI: Cairn IndiaBSE -0.87 % has told oil minister Veerappa Moily that quick approvals for projects in its Rajasthan blockwill help India save $1.5 billion foreign exchange. Cairn India CEO P Elango gave this suggestion after Moily sought his views on saving foreign exchange. Moily has also sought suggestions from Oil and Natural Gas Corp (ONGC).
Earlier, Reliance had argued that the government can do more to ensure that proven gas fields are developed so that imports of costly liquefied natural gas can be replaced with domestic output.
Elango told Moily that Cairn India was ready to invest $3 billion in exploring and developing oil and gas blocks after Moily assured to resolve outstanding issues soon, officials in the ministry said. Cairn India had earlier complained that its partner in the block, ONGC, was not allowing quick approvals in the block.
"We are open to ramping up production in Rajasthan block by 200,000 to 215,000 barrels per day in the current financial year. We can save about $1 billion foreign exchange for every increase of 25,000 barrels of crude oil production per day." Cairn India CEO P Elango told ET.
The petroleum ministry has also given in-principle approved to Cairn's Ravva oilfield development plan. This will raise output by 5,000 bpd in the 18-year-old field that is declining. The block has four discoveries that were earlier unviable, but higher oil prices have made them viable, officials said, adding that approvals were likely this month.
Cairn wants permission to explore the Palar offshore block, where Cairn is the operator with 35% stake. The block lies between the KG and Cauvery basins. Cairn expects three discoveries in the block but the department of space has declared the region as restricted area.
Officials say a solution is expected soon as the Prime Minister wants to cut oil import bills by $25 billion. Moily is expected to announce several policy decisions to reduce oil import bills in next two weeks, the officials added.