Cairn Oil and Gas, a division of the Vedanta Group, plans to invest $3-4 billion in the upstream sector over the next three to four years to expand its business and drive growth. In the previous year, the company invested approximately $400 million in its fields, wells, and expansion activities. The upcoming investments will focus on initiatives such as Alkaline-Surfactant-Polymer (ASP) flooding expansion, tight oil projects, deepwater exploration, and shale development.

Cairn holds a substantial portfolio of onshore blocks and is actively working to expand its presence in offshore regions by acquiring more deepwater blocks. The company aims to contribute 50 per cent of India’s domestic energy production, doubling its current contribution of 25 per cent. Cairn’s portfolio consists of 62 blocks covering an area of 60,000 square kilometre, with five blocks under production and the rest in the exploration phase.

Cairn is in the process of demerging from its parent company, Vedanta, to become a separately listed entity. The oil and gas business is self-funded, with approximately 40 per cent of Vedanta’s total capital expenditure allocated to Cairn.

The company is also targeting the Northeast region of India for future growth, with significant potential identified in its onshore blocks. Cairn plans to commence production from at least two to three wells in this region in the fiscal year 2025-26.

With recent amendments to the Oilfields Regulation and Development Act, Cairn anticipates increased participation from foreign players in the Indian upstream market, potentially partnering in its hydrocarbon blocks. Additionally, the company is addressing output decline from matured fields, particularly in Rajasthan, where it has already produced around 800 million barrels and aims to extract up to 55 per cent of the estimated 2.2 billion barrels.

Cairn is also diversifying into coal bed methane exploration, having acquired a CBM block with operations set to commence within the next eight to ten months.

News source: Financial Express