State may get 300cr annual exchequer boost from Essar

Kolkata: The West Bengal government is likely to get Rs 300crore annual exchequer boost from the CBM (coal bed methane) project of Essar Oil & Gas (EOGEPL) in two-three years down the line. The hydrocarbon outfit is currently contributing Rs 150 crore to the state exchequer as royalty and VAT (value added tax) from the CBM extracted from its field in Durgapur-Raniganj areas. The CEO of EOGEPL, Pankaj Kalra, told TOI that it is currently producing 8 lakh standard cubic metre per day (SCMD) of gas contributing 65% to India’s total CBM production and strive to achieve 1 million SCMD very soon. The other operational CBM players in the country are Reliance Industries and Great Eastern Energy. EOGEPL has a recoverable reserve of one trillion cubic feet of CBM.“If we gauge the scale, it is equivalent to serving around 1.3 lakh cars per day. This production would be achieved in the next four-five months,” he added. The total taxi fleet of Kolkata taken together app cabs and yellow taxi is around 30,000. However, Kalra pointed out that 80-85% of the production of Essar is going to national grid as the pipeline to Kolkata has not yet been completed. He indicated that once the gas pipeline to Kolkata is complete, a substantial part can be brought to the city. GAIL is executing the pipeline as part of the national gas grid. According to him, due to non-completion of the pipeline, Essar had to cut down production earlier. It had 350 wells, which were built till 2017 at an investment of Rs 5,000 crore. Due to lack of demand it had to plug some wells. However, it is now starting drilling new wells and is planning 200-250 more in the next 18-24 months. “We plan to invest another Rs 2,000 crore into the business to ramp up our production and contribute at least 5% of the total India’s gas production. We plan to start our new drilling campaign in 18-24 months to take production to over 3million SCMD. We want to take gas in the energy mix from 6% currently to 15% by 2030,” he added. CBM will play a significant role in India and Essar will be the flag bearer. “We have the best R&D team and strive to enhance productivity on a day-to-day basis and aim to be the lowest cost producer in the world,” Kalra said.