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British firm strikes gas in northeast India

A British oil and gas exploration firm has struck natural gas in India's northeastern state of Assam, the second such success in the area in two months.

india Updated: Jul 08, 2007 15:03 IST

A British oil and gas exploration firm has struck natural gas in India's northeastern state of Assam, the second such success in the area in two months.

The London-based Premier Oil, a leading independent oil and gas company with producing interests in Britain, Indonesia, Pakistan, Africa and Southeast Asia, has found gas at a drilling block at Pechadhar near Silchar in southern Assam, about 320 km from the state's main city Guwahati.

"We experienced gas pressure while drilling at a depth of 3,998 metres. We are quite confident that this area has a huge reserve of natural gas," a company official told IANS requesting not to be named. Premier Oil began work in Assam's Cachar district in January.

"We shall be carrying out several tests now before we begin extracting gas," the official said. The Cachar block covers 2,570 square km, and lies adjacent to large gas discoveries in eastern Bangladesh.

"Our company has interpreted very large structures on satellite and seismic data, indicating significant gas and oil potential for this area," the official said. The company would drill two more wells in the adjoining Hailakandi district soon.

India's premier oil exploration firm, Oil and Natural Gas Corp (ONGC), had already struck gas in the area in May - known to be a high potential zone for oil and gas.

Assam has over 1.3 billion tonnes of proven crude oil and 156 billion cubic metres of natural gas reserves of which about an estimated 58 per cent of hydrocarbon reserves are yet to be explored. Assam currently produces about five million cubic metres of natural gas annually.

Meanwhile, oil giants ONGC and Oil India Ltd have started importing technology to revive production of crude from aging oilfields in Assam.

"The prime objective of the project is to reverse the trend of declining oil production from the aging fields of Assam," an ONGC official said. ONGC has earmarked a whopping Rs 40 billion for boosting production from drying wells.

"There are some 2,000 wells in Assam that have stopped producing oil for more than a decade. But experts are of the opinion that these aging wells have the potential to yield oil. Efforts are on to revive such non-functional sites," Assam Industry Minister Pradyut Bordoloi told IANS.

Assam is home to the world's oldest operating oil refinery at Digboi, established in 1901. The state occupies an important position in the history of oil industry in India and accounts for nearly 50 per cent of the country's on-shore crude oil production.

"Assam has the highest success ratio in the world with 70 per cent of the exploration sites yielding oil and we are sure our new company would be able to exploit the situation.