Essar Caps CBM Production

Essar Oil has temporarily capped gas production at Raniganj in India's eastern state of West Bengal pending regulatory approvals.

"The production has been deliberately controlled since the block is awaiting some approvals before the commercial sales begin," company chairman Shashi Ruia informed the shareholders at the company's AGM on Friday.

The company which has already built the necessary infrastructure to undertake delivery of gas,
reported a test production of 33,000 standard cubic metres of gas per day at the Raniganj coal bed methane block.

The production from the block, which can reach a peak figure of over 3 million standard cubic meters per day in the next there years, will last 15 years, he said. The block has resources of 4.6 trillion cubic feet (tcf) and recoverable resources of around 1 tcf.

Essar is investing close to $300 million for CBM gas production.