ONGC, Cairn to reach agreement on Rajasthan pipeline

New Delhi: State-owned ONGC and Cairn India are reaching an agreement to build a pipeline to transport crude oil found in Barmer, Rajasthan to a nearby port city. Sources said a feasibility study on the technical aspects of the pipeline is currently going on, as the crude from Rajasthan requires a proper heating arrangement apart from which a route survey was also being undertaken. The crude from Rajasthan is heavy with high wax content and requires specialised pipelines to transport it from Barmer. The feasibility study would also bring out the issue of cost recovery and the size of pipeline that is required.

Sources said the pipeline cost would be part of the field development plan for the Rajasthan fields, as this would be recoverable.

Sources said that like the cost for developing Mangala, Bhagyam and Aishwariya fields, the pipeline investment would also be shared between Cairn and ONGC in a 70:30 ratio, which is the current equity structure of the two companies in the fields.