Cairn India Limited said it is currently evaluating the options of converting gas into commercial use, one and a half years after identifying natural gas in the Sri Lanka’s Mannar Basin.

“Two gas discoveries were made out of the four exploration wells drilled; options to monetize the discovered gas resources are under evaluation,” said director and interim CEO, Cairn India Limited, P. Elango.

Cairn Lanka (Private) Limited, the fully-owned subsidiary of Cairn India Limited in late 2011 discovered natural gas reserves and condensate discoveries in two successive occasions completing the first phase of the exploration campaign.

However, phase II explorations were abandoned i n February 2013, since the drilling encountered multiple thick high quality reservoir sands, which were not of hydrocarbon bearing.However indicating the company’s plans to enter the Phase-III explorations, the CEO said, “The results of the well are being integrated with reprocessed 3D seismic data to finalize the forward program which includes the options for appraisal of the existing two discoveries and entering exploration phase-III”. Meanwhile the financial statements for the year ended March 31,2013 showed that the unsuccessful well in the Sri Lanka block cost the company approximately US $ 49 million.

The total amount the company had spent on unsuccessful wells remained at approximately US $ 84 million for the annum, an increase of approximately US $ 29 million over the corresponding period.

The group however recorded a 48 percent increase in its revenues to US $ 3.2 billion with a net profit of US $ 2.2 billion, an increase of 52 per cent over the last financial year.

Cairn India, a London Stock Exchange-listed company and one of the largest private exploration and production companies has seven blocks in India, one in Sri Lanka and one in South Africa.

In a bid to offer more blocks in the Mannar and Cauvery basins to investors, the Petroleum Resources Development Secretariat staged Sri Lanka’s second international offshore exploration licensing round on March 07 in the US followed by road shows in London and Singapore. The licensing round is open till September 2013, providing sufficient time for international oil companies to make their final decision, and so far industry giants in the likes of British Petroleum and Shell have expressed interest in Sri Lanka’s upstream petroleum activities.