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Licence block CY-OS/2 is located in the
northern part of the Cauvery Basin immediately offshore from
Pondicherry and covers approximately 859 km2.
In 2007, as part of the licence’s
exploration phase III work commitment, HEPI drilled two exploration
wells: Fan E-1 and Fan A-1. On 8 January 2007 the Company announced
that the Fan A-1 well had discovered hydrocarbons. On 10 August
2007 the Company announced that it would proceed to the appraisal
phase of the Fan-A1 discovery to establish the potential commerciality
with the planned drilling of three further wells.
The CY-OS/2 licence
comprises two retained areas (figure 3 on page 57 of this document).
The northern area includes the Fan A-1 discovery. The southern
area lies immediately adjacent to the HEPI operated PY-3 field,
which had produced 21.18 MMstb oil by 30 September 2007. The
PY-1 gas field lies within the southern part of the acreage
and is expected to begin production by the first quarter of
2009.
The
PY-3 oil field and PY-1 gas field are both contained within
the CY-OS/2 licence but have been ring-fenced out, each with
a separate PSC. The CY-OS/2 exploration licence has been under
an approved phase III extension which expired at the end of
March 2007. HEPI, as Operator of the joint venture, has fulfilled
the phase III commitment work programme of 3D seismic surveys
and drilling of two exploratory wells. Presently the licence
is under appraisal phase, consisting of re-evaluation of existing
3D seismic data and drilling of three wells and two contingent
(optional) wells. The drilling campaign is expected to commence
in the last quarter of 2008.
The Board is presently considering
farming out a portion of its participating interest in the licence.
HEPI has a 75 per cent. participating interest in and is the
Operator of this licence, which is at present an exploration
licence only. The participating interests (per cent.) in licence
CY-OS/2 are as follows:
|
Participating Interests
(%) |
|
AREA |
HEPI |
GAIL |
|
CY-OS/2 |
75 |
25 |
*In the event of a commercial
discovery, ONGC has the option to back into the CY-OS/2 licence
at an interest of 30 per cent.
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