12 March 2012

Cairn Lanka to Start 2nd Phase of Oil Exploration in Sri Lanka's Mannar Basin. Oil Wells to be Drilled in 2013

08th March 2012, www.island.lk

Cairn Lanka has commenced the second phase of oil exploration in the Mannar Basin and oil wells are likely to be drilled in 2013 after another round of seismic studies.

Cairn Lanka, the wholly owned subsidiary of Cairn India Limited successfully completed the first phase of the exploration campaign on Sri Lanka’s side of the Mannar Basin on Block SL-2007-01-001 and has delivered two back to back discoveries.

According to our sources here, the seismic study has already commenced in the Mannar block, and the seismic vessel Pacific Explorer has begun its seismic activity. The 3D seismic contract has been awarded to Petroleum Geo-Services (PGS). The seismic survey will be followed by a technical evaluation of the data, data interpretation and then with another drilling campaign. An international tender for this seismic programme was floated by the company last year during the first phase of drilling campaign.

Cairn Lanka had spent over US$ 150 million in the first phase of the drilling campaign that resulted in two gas discoveries. The initial estimate for the programme was around US$ 110 million.

The drilling campaign in the second phase will be undertaken during the fair weather window and it is learnt that Cairn Lanka has already initiated its legwork for this second phase with a plan for a deepwater drilling campaign. According to the scope of the international tender, the work programme will involve one firm well and have provisions for three optional wells too, in the Gulf of Mannar. It is likely to commence in 2013, post completion of data interpretation and other pre-drilling tests and studies.

Cairn Lanka has also floated an international tender inviting experienced services contractors to provide services for this deepwater drilling campaign.

The company has invited an international tender bid for the drilling operation. A series of stringent guidelines have been laid out for the contractors who need to comply with, and should have a successful track record to be considered. Special emphasis is also being laid on the contractor’s ability to adhere to the "stringent" health, safety and environmental management requirements.

According to industry sources, the company is looking for a Drillship or Semisubmersible Rig – that is capable of operating in water depths between 800 to 1700 metres. The rig should have a capability to drill a maximum depth of 5500 m.

The first phase of the exploration programme involved the acquisition, processing and interpretation of 1,753 sq km of 3D seismic data and a three well deep water drilling programme. The seismic programme exceeded the phase I commitment by 20% and the drilling programme exceeded the drilling depth commitment by 50%. The first phase of the programme resulted in two successive gas and condensate discoveries: the CLPL-Dorado-91H/1z well and, the CLPL-Barracuda-1G/1 well.

Related Info :
One Billion Barrels of Oil in Sri Lanka Mannar Basin - Director General of Sri Lanka's Petroleum Resources

Cairn India Calls for Oil Spill Response Proposals as It Drills First Well off Sri Lanka in August
Sri Lanka's Commercial Production of Oil Could Start by 2017 - Professor Stuart Burley of Cairn India

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