OIL loses Rs 148 cr revenue due to well closure around Baghjan fire

State-owned Oil India Ltd lost Rs 148 crore in revenue in 100 days from the closure of oil and gas wells in the vicinity of the Baghjan fire in Assam, Oil Minister Dharmendra Pradhan said on Wednesday.

The blowout at a gas well resulted in the closure of a number of producing oil and gas wells in and around Baghjan in Tinsukia district due to protests by locals, he said in a written reply to a question in the Rajya Sabha.

"The closures of producing wells has resulted in an estimated revenue loss of about Rs 148 crore to the company during the period from May 27, 2020, to August 8, 2020," he said.

A massive fire had broken out at the gas well in May-end after gas that had been leaking for two weeks ignited, sending plumes of smoke and flames into the sky.

"The revenue loss due to gas-burning uncontrollably into the atmosphere from the blowout well could not be ascertained as no measurement was possible due to fire and extreme heat," Pradhan said.

He said the ministry has constituted a three-member inquiry committee to look into the incident.

"In addition, inquiry committees have also been set up by Directorate General of Mines & Safety (DGMS), and Oil Industry Safety Directorate (OISD), Government of India," he said. "The report submitted by OISD suggests that pulling out of drill pipe and nipple down Blowout Preventer before complete settling of cement is the root cause of incidence."

The well was producing 80,000 standard cubic meters per day (SCMD) of gas from a depth of 3,870 meters before the blowout in May, according to Oil India.

Just a kilometer from the field is Maguri-Motapung wetlands, an ecotourism site. State-owned sanctuary Dibru Saikhowa national park – renowned for migratory birds – is about 2.5km away.

"There has been an impact on the nearby areas because of the heat and noise generated from the blowout well of the Baghjan field," Pradhan said. "The Energy Research Institute (TERI) has been engaged for Ambient Air Quality (AAQ) monitoring and Bioremediation, North East Institute of Science and Technology (NEIST) for Seismological Study and IIT, Guwahati for heat impact through Thermal Imaging."