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Oil exploration in Arunachal Pradesh crippled

Syed Zarir Hussain in Guwahati

Oil India Limited, the country's premier exploration company, has shut down operations in Arunachal Pradesh state in the wake of stepped-up extortions by tribal separatists, officials said Sunday.

"We have withdrawn all our technical staff from the drilling sites at Khumsai in eastern Arunachal Pradesh following an extortion notice of Rs 6 million by a militant group," OIL chairman-cum-managing director B B Sharma said.

"This is the first time since OIL's inception in 1959 that we

received an extortion notice from any militant group," he said by telephone from OIL headquarters in Duliajan in Assam state.

The outlawed National Socialist Council of Nagaland, led by factional leaders Thuingaleng Muivah and Isak Chishi Swu, had served the extortion demand.

The notice was served despite a ceasefire between the NSCN and the federal government was in force.

The NSCN has well entrenched bases in eastern Arunachal Pradesh, Assam, Manipur, besides its own Nagaland state.

"The deadline to pay the extortion demand was August 1. Since we decided against compromising on this issue, we pulled out our personnel from the oil wells in Arunachal Pradesh on Tuesday," the OIL chief said.

The well at Kumsai produces about 100 kiloliters of crude oil daily. Unless operations are resumed soon it is expected to incur a loss of Rs 2.5 billion annually.

An OIL official said the company was unable to carry out new exploration works for fear of militant threats.

"Exploration works are hampered in parts of Tripura, in Assam, and now in Arunachal Pradesh due to militancy," the official said.

India's annual crude oil production stands at 60 million tonnes, almost half the country's needs.

"In 1999, Assam produced 3.29 million tonnes of crude oil and it dropped last year to 3.28 million tonnes. The decline in crude oil production is best attributed to the disturbed law and order situation in the region," the official said.

Meanwhile, the OIL have decided to dig one of Asia's biggest river, the Brahmaputra in Assam, to look for crude oil reserves with a view to achieving the target of producing 100 million tonnes in the next couple of years.

Oil experts will carry out two-dimensional seismic surveys in the riverbed before starting drilling operations on the Brahmaputra.

"We need to start exploratory works in new areas with the old oilfields showing declining trends," the official said. "The production capability is very high in new areas. So we are giving much emphasis on exploratory and drilling works in unexplored locations."

Seismic surveys are also being carried out in some old oilfields with a view to enhancing the production. The Oil India Limited has a total oil and gas reserve of 790 million tonnes in India, of which about 307 million tonnes were recoverable.

The 1,160-kilometer long crude pipeline from the OIL headquarters at Duliajan in eastern Assam to the Baruani refinery in Bihar is one of Asia's longest and oldest trunk pipelines.

Indo-Asian News Service

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