Essar Energy pursuing shale gas opportunity in West Bengal

Essar Energy is looking to ramp up coal bed methane production at Raniganj (East) block to three million standard cubic metres a day by 2017-18


Essar has already sunk in Rs3,300 crore to drill and frack some 300 wells, leading to the start in coal bed methane (CBM) production. Photo: Bloomberg
Essar has already sunk in Rs3,300 crore to drill and frack some 300 wells, leading to the start in coal bed methane (CBM) production. Photo: Bloomberg

Kolkata: Essar Energy Plc on Wednesday said it was looking to produce shale gas from Raniganj (East) in West Bengal even as it announced coal bed methane (CBM) production from the block had topped one million standard cubic metres a day for the first time.

Apart from CBM, a preliminary assessment at the Raniganj (East) block had indicated a shale gas reserve of eight trillion cubic feet, the company said in a statement. CBM production and shale gas extraction are complementary, said Manish Maheshwari, Essar Energy’s chief executive officer-exploration and production.

Whereas shale gas extraction requires water, CBM production releases a lot of water, Maheshwari said, adding that there is scope for cost optimisation if the two could be pursued simultaneously.

Essar Energy is looking to ramp up CBM production at Raniganj (East) block to three million standard cubic metres a day by 2017-18 at an additional investment of Rs.700-800 crore, he said. The company has already sunk in Rs.3,300 crore to drill and frack some 300 wells, leading to the start in CBM production.

Over the next 20-25 years, the state of West Bengal will earn Rs.2,500 crore in royalty from CBM production alone, according to Maheshwari.

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