• Investment World
• eWorld
• Brand Line
• Mentor
• Life
• Brand Quest
• The New Manager
• Smartbuy

Stocks

• Quotes
• SE Diary
• Scoreboard
• Open-End Mutual Fund

Cross Currency

• Rates
  
  

Shipping

• Ports
  
  

Archives

• Yesterday
• Datewise
• Resources
• In Focus
• In Depth
• Events 2007

Group Sites

• The Hindu
• The Hindu ePaper
• Business Line
• Business Line ePaper
• Sportstar
• Frontline
• The Hindu eBooks
• The Hindu Images

Amit Mitra

Mumbai, June 3 Essar Oil is ramping up its oil exploration and production business, lining up a work programme in the current phase of existing blocks to the tune of $290 million.

Out of this, the company plans to invest $130 million in the current fiscal. The work programme includes seismic operations in Assam, Madagascar, Nigeria and Vietnam, drilling of wells in Raniganj and Mehsana and development of Ratna fields.

Essar is also scanning and evaluating exploration and production opportunities globally, focussing on West Asia , South East Asia, Australia, China, the Indian sub-continent, South America, Eastern Europe and Russia.

A senior official of the company said last fiscal, it had spent $75 million on exploration and production activities. It has produced and sold more than 17,000 bbls of crude oil. More than 15 crore holes have been drilled and coal tested for permeability and gas content in Raniganj, while drilling of 15 test wells is in progress.

Its exploration and production assets include 70 per cent ownership in Mehsana block, 63 per cent interest in offshore block (OPL 226) in Nigeria and 100 per cent in offshore block (114) in Vietnam, apart from two exploration blocks in Assam, three in Madagascar and another in Durgapur, West Bengal — some of these assets are under transfer at present.

With crude oil prices touching a record high of $135 last month, Essar Oil feels that the price outlook for the current fiscal remains bullish, but extreme volatility cannot be ruled out. “There are signs of healthy demand in China, India and West Asia, while speculation in the futures market is fuelling the price rally,” the official said.

Further, the gasoline margins have been negatively impacted by the high level of inventories in the US and arbitrage flows in Asia from Europe. Gasoline stock-draws during peak driving season in the US, along with the tight distillate markets in Europe and Asia, should support the product market, lifting refining margins across the globe, the company feels.

More Stories on : Outlook | Petroleum

Article E-Mail :: Comment :: Syndication :: Printer Friendly Page

Stories in this Section
Amara Raja Batteries shifts office

Copyright © 2008, The Hindu Business Line. Republication or redissemination of the contents of this screen are expressly prohibited without the written consent of The Hindu Business Line