Vedanta-owned Cairn Oil and Gas is counting on its shale exploration programme in Rajasthan, predicting that shale oil and gas output would lower India's oil and gas imports by 10% after production.
Natural gas trapped in fine-grained sedimentary rocks called shales is known as shale. Mangala, Bhagyam, and Aishwariya (MBA) are Cairn's flagship and most prolific onshore Rajasthan oilfields. They are responsible for up to 20% of India's total crude output. Cairn aims to generate half of the country's oil and gas, but diminishing hydrocarbon output from the MBA fields has proven difficult. Cairn plans to improve production by using improved oil recovery programmes. In November, the company partnered with oil field services giants Halliburton and Baker Hughes and additional collaborations are in the works. To improve output in fiscal year (FY) 2023, the company will invest $700 million in its exploration programme. It plans to boost exploration and production from its offshore blocks in addition to its Rajasthan block exploration programme. Cairn controls 55 exploration and production blocks, with plans to invest up to $5 billion in exploration over the next three years. Shale gas, if successful, may be a game-changer for India, just as it has been for the United States. Due to the lack of significant reserve discoveries in India in recent decades, crude imports account for 85% of the country's import bill. The shale revolution, which began in the early 2000s in the United States, helped the country lessen its reliance on costly oil and LNG. The country went from being an oil importer to a shale gas exporter. Between 2010 and 2013, Reliance Industries Limited (RIL) invested in three upstream oil exploration joint ventures with Chevron, Pioneer Natural Resource and Carrizo Oil and Gas, including a midstream joint venture with Pioneer. Although, once oil and gas prices plummeted in 2014, shale began to lose its lustre. RIL has subsequently sold its shale gas holdings and abandoned the North American market. Oil prices fell to $44.08 a barrel in January 2015 after peaking at $107.95 a barrel in June 2014, before crossing the $100 a barrel level again last month. ONGC also tried shale drilling in India a few years ago before abandoning the project due to poor success. Image Source
