Essar Oil & Gas Exploration & Production Ltd. has secured five coal bed methane (CBM) blocks across West Bengal, Madhya Pradesh and Telangana, expanding its exploration acreage by approximately 1,281 square kilometres and marking its entry into Telangana.
The five blocks, awarded under the government’s Special Coal Bed Methane (SCBM) bidding rounds for 2025 and 2026, contain estimated gas-in-place resources of 6.6 trillion cubic feet (TCF), according to the company. The awards comprise two blocks spanning around 330 sq km in West Bengal’s Raniganj region, one block in Madhya Pradesh’s Singrauli basin and two blocks in Telangana’s Godavari Valley.
The new Raniganj blocks will expand Essar Oil & Gas’s acreage in the region from approximately 500 sq km at its existing Raniganj East asset to around 830 sq km. Their proximity to the producing asset is expected to facilitate infrastructure sharing and the development of an integrated CBM field, which the company envisages could become India’s largest.
Essar Oil & Gas currently produces approximately 950,000 standard cubic metres of gas per day from its Raniganj operations, accounting for nearly 50% of India’s CBM output, according to the company. It has invested more than Rs 6,000 crore in exploration and production activities at the asset.
The company plans to progressively develop its expanded CBM portfolio to contribute 5% of India’s total natural gas production. CEO Pankaj Kalra said the latest awards marked a significant milestone in the company’s growth strategy and reinforced its commitment to developing India’s unconventional hydrocarbon resources. He added that the company would focus on translating the expanded acreage into production growth by leveraging its technical expertise and existing infrastructure.
Essar Oil & Gas Chairman and Essar Group Operating Partner for Energy Bhuwan Chandra Tripathi said natural gas would continue to play an important role in India’s energy mix as demand increases.
The expansion comes amid India’s efforts to strengthen domestic natural gas production and reduce import dependence. Coal bed methane is an unconventional natural gas resource trapped in coal seams. Its extraction generally involves removing water from coal seams to reduce pressure and release the gas. Commercial development depends on reservoir characteristics, production economics and the availability of supporting infrastructure.
