Essar To Double Coal-Bed Methane Gas Production From East Raniganj Field
The Essar logo pictured at the conglomerate’s steel plant in Pune. (Photographer: Dhiraj Singh/Bloomberg)

Essar To Double Coal-Bed Methane Gas Production From East Raniganj Field

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Essar (India) Ltd. plans to double production of coal-bed methane gas from its Raniganj east block in West Bengal as a vital Urja-Ganga gas pipeline connecting users in Eastern India gets commissioned by the year-end, a company official said on Wednesday.

Essar Oil and Gas Exploration and Production currently produces about 0.45 million standard cubic metres per day due to constraints of pipelines that could take the gas to consumers. The company plans to ramp up the production to more than 1 mmscmd, said the official, requesting anonymity.

This would be the highest production of CBM gas from any block in the country.

The firm has already invested Rs 4,000 crore in the project, which encompassed drilling of 348 wells, setting up the supply infrastructure, and laying pipelines to Durgapur and nearby industrial areas.

The current production from the Raniganj east CBM block is significantly lower than its capacity with the company having to throttle the output at about 0.45 mmscmd because of lack of a pipeline to take the gas to consumers.

"We have already produced 1 mmscmd gas from this block, which is the highest by any player in the sector. However, sustaining production at that level is unfeasible without the GAIL pipeline being commissioned. This is why we are producing far lower quantities of gas than we are capable of," the official quoted above said.

The Pradhan Mantri Urja Ganga natural gas pipeline transverses from Jagdishpur in Uttar Pradesh to Haldia in West Bengal and Bokaro in Jharkhand and Dhamra in Odisha. The pipeline is being commissioned in phases and the last leg is scheduled for completion by December 2019.

This will help gas supplies to reach four fertiliser plants in Gorakhpur, Sindri, Barauni and Panagarh, besides more than two dozen towns where city gas distribution rights have been awarded recently. The total demand in the region is envisaged at about 20 mmscmd.

CBM is natural gas stored or absorbed in coal seams and contains 90-95 percent methane. According to the Directorate General of Hydrocarbons, India has the fifth-largest proven coal reserves in the world and, therefore, holds significant prospects for exploration and exploitation of CBM gas.

Raniganj east block is India's most prolific CBM block, holding 1 trillion cubic feet of recoverable reserves. Essar Oil and Gas Exploration and Production is also planning to drill wells in accordance with the approved field development plan for the block, said the official. The additional wells will enable the company to ramp up production to a peak of 2.3 mmscmd in the next few years, he said.

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