Essar, Arrow, Great Eastern to invest $158 mn in CBM blocks

July 30, 2010: Essar Oil, Australia's Arrow Energy and Great Eastern Energy will invest $158 million in seven coal bed methane (CBM) blocks, for which contracts were signed with the government today.

"These (seven) blocks located in the states of Assam, Jharkhand, Orissa, Madhya Pradesh, Chattisgarh and Tamil Nadu would bring committed investment of $158 million," Minister of State for Petroleum and Natural Gas Jitin Prasad said at the signing of Production Sharing Contracts (PSC).

Essar Oil, which was the biggest winner of the recently-concluded fourth round of CBM bidding, signed PSCs for four blocks. Arrow Energy signed contracts for two CBM blocks through two separate joint ventures with Oil India Ltd and Tata Power, while one block went to the Great Eastern Energy Corporation.

Till date, 33 blocks have been awarded and more than 300 CBM wells drilled, he said. Petroleum Minister Murli Deora said that about 100,000 cubic metres of CBM gas was currently being produced in the country.

India imports 80% of its crude oil requirement. The CBM, along with gas output from the Krishna Godavari basin, would help reduce the country's import dependence.

Source: The Economic Times