GEECL likely to bid for CBM blocks

The Great Eastern Energy Corporation is likely to be one of the bidders for the fourth round of coal bed methane (CBM) block auction.

"We are looking to bid for CBM blocks opened in fourth round of auction by the government, currently assessment of the resources opened under auction is being done," chief operating officer GEECL Prashant Modi told reporters in Ahmedabad on Tuesday.

The ten blocks offered under CBM-IV auction by government cover an area of about 5,000 square kilometers and are spread over seven states of Assam, Jharkhand, Orissa, Madhya Pradesh, Chattisgarh, Maharasthra and Tamil Nadu.

The bidding for CBM blocks ends on October 12, for which the government is currently holding roadshows globally, sources said.

Currently, GEECL produces CBM from its block in Raniganj, West Bengal, which is spread across on aggregate area of 210 square kilometres, the company statement said.

"The company has completed 30 wells as on July 2009, with 23 additional wells in various stages of completion, and has commissioned one gas gathering station," Modi said.

GEECL plans to dilute 10 per cent of company equity holding through initial public offering (IPO) route in India.

"We plan to raise Rs 400 crore (Rs 4 billion) from the market by this year-end," Modi said.

"We plan to develop 100 wells in next two years with an estimated investment of Rs 825 crore (Rs 8.25 billion) and aim to invest another Rs 2,000 crore (Rs 20 billion) in next 5 to 8 years span in West Bengal," Modi said, highlighting company's growth plans.

GEECL raised a loan of Rs 300 crore (Rs 3 billion) from SBI to expedite its further drilling plans, and is in the process of utilising the funds, Modi added.