EOGEPL is India's largest coalbed methane operator, with a current production of close to 950,000 cubic metres per day of gas from its Raniganj East block in West Bengal. The company is targeting a significant expansion to reach a production portfolio of 100,000 barrels of oil equivalent per day within the next four to five years.

Expansion Strategy and International Portfolio

The expansion plan involves a combination of developing existing assets and pursuing acquisitions. EOGEPL is actively scouting for international acquisition opportunities in Australia, Indonesia, and Africa, with a focus on developed assets rather than exploration. The company also holds a 45% stake in Vietnam's Block 114, operated by Eni. This block contains the giant Ken Bau gas condensate discovery, estimated to hold 8-9 Tcf of gas in place and about 500 million barrels of condensate, representing a major future production upside. The joint venture has invested $350 million in the block to date.

Raniganj CBM Asset: Core Growth Engine

The Raniganj CBM block is central to the company's near-term growth. Current production from Raniganj is approximately 6,000 boepd, but the company believes this asset alone can increase to 20,000 boepd in the CBM space. The block has substantial in-place resources of 4 Tcf of gas and recoverable reserves of 1 Tcf. Furthermore, EOGEPL is confident in the block's shale gas potential, which it estimates could independently contribute an additional 20,000 to 30,000 boepd. The company has drilled two core shale wells to assess this potential.

Third Capital Expenditure Cycle and Technological Shift

EOGEPL is poised to begin a third capex cycle at Raniganj in May, with an investment of $100 million. This cycle aims to drill up to 100 additional wells over two years, targeting a production increase of almost 2 million cubic metres per day. A key innovation driving this phase is a shift from vertical to horizontal drilling technology. While a horizontal well costs 1.5 to 2 times more than a vertical well (approximately 100 million vs. 60 million Indian rupees), its productivity is estimated to be five times greater, potentially yielding up to 20,000 cubic metres per day per well compared to 5,000 from vertical wells.

Infrastructure and Domestic Opportunities

The existing infrastructure at Raniganj East is currently underutilized. The compression system can cater to 3 million cubic metres per day of gas and can be modified to handle nearly 5 million cubic metres per day. Following the new capex cycle, the company aims to scale gas production at the block to up to 3 million cubic metres per day. Domestically, EOGEPL is also looking to acquire additional assets through India's CBM and Discovered Small Fields (DSF) bidding rounds.