The environment clearance will allow the company for the full field development of the Raniganj block, excluding the forest area, and enhance its current production of 60,000 standard cubic meters per day of gas (SCMD) to the target level of three million SCMD.
Essar oil, can now drill a total of 650 wells against the current 135 wells in the block.
The Raniganj block spread over 500km² area is estimated to hold total proven and probable reserves of 13 billion cubic feet (bcf) gross or 18.8 million barrels of oil equivalent (MMBOE).
Essar Energy chief executive Naresh Nayyar said the environmental approval will help the company to reach its targeted peak production.
"We expect to grow the coal bed methane business significantly in the coming years as we utilise the learnings from Raniganj to develop our other four blocks," Nayyar added.
The company has already secured sales contract from local industrial customers and will sell the gas produced from the block at an approved test sales price, though it is awaiting the government’s decision on appropriate commercial sales price.
