Shri Ram Naik,
Minister of Petroleum & Natural Gas announced that the Government
of India had signed two contracts for exploration and production
of Coal Bed Methane (CBM) today with Oil & Natural Gas Corporation
Limited (ONGC) and Coal India Limited (CIL). Shri Karia Munda,
Minister (Coal) and Shri Santosh Gangwar, MOS (P&NG) were
also present
Shri Ram Naik informed
that these two blocks namely Jharia and Raniganj (East and Central)
lie in the States of Jharkhand and West Bengal respectively
and were allocated to the consortium of ONGC and CIL on nomination
basis as ONGC was already working in these blocks. ONGC has
already spent about Rs. 30 crores in Jharia block and about
Rs. 4 crores in Raniganj block.
The estimated CBM
resources as per Directorate General of Hydrocarbons (DGH) in
Jharia is about 85 billion cubic metre and in Raniganj about
43 billion cubic metre. ONGC is expected to reach commerciality
stage in about three years in these two blocks.
With the signing
of the two contracts with ONGC and CIL, Government has signed
a total of 8 contracts for CBM. These 8 blocks are located in
Jharkhand – 3 blocks, M.P. – 2 blocks and West Bengal – 3 blocks.
In these 8 blocks
DGH has estimated a CBM resource of about 400 billion cubic
metre and expected production potential in these blocks is about
13 MMSCMD. The total investment in exploration phase in these
blocks will be about Rs. 250 crore (US $ 50 million).
CBM as an energy
source is expected to provide a new source of income to the
State Governments and Central Government in form of royalty,
Production Level Payments (PLP), taxes and commercial bonus.
In addition CBM being a low pressure gas is likely to be utilised
locally for domestic, industrial, power projects etc. and is
expected to improve the economic activities as well as the environment
in the areas of CBM operations.
Shri Naik pointed
out that by taking aggressive steps to explore and produce CBM,
India has joined a select group of CBM nations such as USA,
China, Australia, which are engaged in CBM activities.
Shri Ram Naik congratulated
ONGC and CIL on signing of the contracts for the 2 blocks and
wished them best of luck in their endeavour to explore and produce
CBM from these areas.
Shri Naik announced
that preparatory work for offering blocks under CBM-II was in
an advanced stage in consultation with Ministry of Coal and
CBM-II is expected to be launched in April, 2003.
