Cairn Oil and Gas of the Vedanta Group is planning to spend around $3-4 billion in the three to four years in the upstream sector to expand its business and fuel growth, the company’s Chief Financial Officer, Hitesh Vaid told FE in an interview on the sidelines of the India Energy Week.
“Last year we invested around $400 million on our fields, wells, our expansion, and everything else. Now with so many things lined up like ASP (Alkaline-Surfactant-Polymer) flooding expansion, tight oil expansion, deepwater, and shale. I think over the next three four years, we are looking at a $3-4 billion investment,” Vaid said.
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The company, which has a fairly good number of onshore blocks under its portfolio, is also focusing on expanding its acreage in the offshore regions and acquiring more deepwater blocks.
“Our vision is to contribute 50% of India’s domestic energy production. Currently we contribute to 25% of the country’s total production and now we need to double it and acquire acreages,” Vaid said. Presently, the company has 62 blocks spread over an area of 60,000 square kilometers. Of the total blocks, five are under production while the remaining are under exploration stage.
Speaking on the company’s plans to demerge from its group company Vedanta and get separately listed on the exchanges, Vaid said the company is in the demerging process and is self-funded. “From the group (company’s) point of view, we feel that oil and gas businesses are a sizable business and should be separately listed as a pure play business rather than as part of the larger group,” the CFO said. Presently, of Vedanta’s total capex, a sizable portion of sound 40% goes to Cairn.
Other than its already producing blocks in Rajasthan, Gujarat, and Andhra Pradesh, the company will be focusing on the Northeast region with potential of huge value creation.
“Northeast is also a big opportunity for us where we have identified a lot of blocks. We are producing from a small area in Hazarigaon, but we think that in our onshore portfolio this is the place where the biggest value creation could happen,” Vaid said. Cairn now expects at least two to three wells in the Northeast region to start production in the upcoming fiscal year 2025-26.
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