India’s largest oil and gas reserve sees production drop 40%, officials accuse Covid | Latest India News

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Rajasthan’s oil and gas production has seen a 40% drop in the past two years due to a decrease in extraction, mainly due to Covid-19, officials said, even as the government plans to further expand oil exploration in the region.

Oil prices in the country have been on the rise for the past few months due to an increase in crude oil prices on the international market. In parts of Rajasthan, such as Sri Ganganagar, not far from the oil producer Barmer, the price of gasoline is around 110 per liter.

Barmer is the country’s largest source of oil and natural gas and contributed 1,904.79 crore to state revenue in 2020-2021, up from 3,883.22 in 2018-19. This means that the oil fields have contributed 10 crore per day to the state government, whose other major sources of revenue are mining, excise duties, stamps and registration.

State oil revenues have declined mainly due to less oil extraction, affecting crude oil production and prices, and in part from Covid-19, an official said, citing the reasons for the drop in oil prices. income.

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The Barmers Gudamalani area has reserves of 10 billion cubic meters of gas, of which only 30% has been explored. India’s total oil and gas reserves stand at 28.1 billion cubic meters, according to the website of the Ministry of Petroleum.

The official said that in April, May and June 2020, crude oil prices experienced a huge drop in the international market. But despite the pandemic, in 2021-2022, when prices and production were stable and crude oil prices improved in July 2021, expected revenues were collected. Oil reserves are in natural decline, slowing production, the official cited above said.

The government, until July of this year, received revenue of 1,193 crore. He set a target of 3,500. The official said demand for oil has started to rise and the price of crude oil has also improved. He added that improved oil recovery techniques are being used to maintain production – all of these factors have led to increased income.

However, despite fluctuating state revenues, the decade and a half of oil exploration in Barmer has changed the indescribable little town. Barmer has gone from a small hamlet to a glitzy town, said Rakesh Sharma, a local political activist.

The discovery of crude oil and coal in early 2004 fueled the growth of Barmers, as oil majors Cairn India and Raj West Power invested heavily, spawning thousands of new jobs in a city of 1.5 million people. inhabitants, about 540 km from Jaipur. Companies have acquired huge plots of land, driving land prices five to ten times over in a short period of time. Now an upcoming oil refinery worth 43,129 crore is expected to further raise land prices and bring a new round of development to the city. Commercial production will begin from the Barmer refinery by March 2023. The refinery will process 9 million tonnes of crude oil per year. A work order of 37,464 crore has been issued for the refinery project until July 2021.

Additional chief secretary for mines and oil, Dr Subodh Agarwal, said that in March 2021, the western region of the state received a boost for further development as the plant’s third gas plant Rageshwari’s deep gas tank was ready. This would create thousands of new jobs and further boost the region’s economy in the western region, which was previously considered backward, he said.

Thanks to the plant, now operational, total natural gas production increased to 3.8 million cubic meters (mcm) per day (in July 2021) from 2.9 million cubic meters per day in March 2021. This would represent five percent of the total gas production in the country, according to the website of the Ministry of Petroleum.

Agarwal said a refinery and petrochemical complex was also being set up in Pachpadra, Barmer, on 4,813 acres of land that is expected to begin commercial production by March 2023.

The second wave of the pandemic reduced the pace of work at the refinery. Until June 2021, work orders worth 37,347 crore were issued. Of that amount, 8,041.66 crore has been spent, he told Jaipur on Monday.

Commercial production will begin at the Barmer refinery by March 2023, he added.

In the next few days, he said, Oil India will invest around 95 crore to explore mineral oil and natural gas in Barmer. And from the start of production, the state will generate revenue at the rate of 12.5% ​​on mineral oil and 10% on natural gas production, he said.

The state’s oil basin covers an area of ​​1.5 lakh square kilometers in the districts of Barmer, Jalore, Jaisalmer, Nagaur, Sriganganagar, Hanumangarh and Churu. About 1.20 lakh to 1.22 lakh barrels of crude oil and about 33 to 35 lakh cubic meters of natural gas are produced in the state every day.

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