Cairn Oil & Gas aims to invest $5 billion to unlock India’s shale reserves and increase output to 1 million barrels daily over the next decade.
Cairn Oil & Gas, the energy division of Vedanta Limited, has announced plans to seek partnerships valued at $5 billion from American firms to enhance the development of India’s shale industry. Executives from Cairn are currently in Houston, engaging with oilfield contractors to facilitate the growth of shale production in India. The initiative was publicly discussed by Vedanta Chairman Anil Agarwal during a recent interview.
This effort is pivotal for India as the country strives to decrease its reliance on foreign energy imports. Vedanta’s Cairn Oil & Gas, as the largest private oil producer in India, aims to significantly ramp up its daily production capacity to reach an equivalent of 1 million barrels over the next several years.
Cairn is responsible for over 25 per cent of India’s total oil and gas production annually. To enhance its operations, the company has already started to recruit international talent with expertise in tight oil, gas, and shale development, reflecting its commitment to operational excellence.
The company will focus on exploring shale oil opportunities in the deeper graben formations located in Rajasthan, specifically around the Barmer region, which is regarded as its most substantial onshore asset. Plans include the drilling of at least three to six shale wells, with a rig set to arrive in India in the near future to commence operations. Initial assessments have indicated that the Barmer region possesses significant shale reserves.
This strategic push into shale resources aligns with India’s ambitions for energy security. Currently, the nation relies on imports for over 85 per cent of its oil and 54 per cent of its gas needs. Cairn Oil & Gas’s contribution is essential in mitigating this import dependency through local production enhancements.
Cairn has already begun collaborations with American oilfield services companies, such as Halliburton, to tap into advanced shale exploration techniques developed during the United States shale boom. The overarching aim is to utilise American drilling technology and expertise to access unconventional resources effectively.
The company manages 58 blocks throughout India with estimated gross reserves exceeding one billion barrels of oil equivalent. The engagements in Houston are seen as a critical step towards establishing the necessary technical capabilities essential for realising India’s shale potential, which has yet to be fully developed, despite significant reserves being identified across various basins in the country.
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