The Guardian: Filthy lucre: Oil, oil - everywhere! “And what about Rajasthan? Shell had more or less abandoned prospecting there, but oil minnow Cairn Energy made several major finds this year and reckons Rajasthan could be the new Texas” (ShellNews.net)

Stephen Moss

Thursday August 5, 2004

Oil prices are soaring, stock markets are falling, the end of the world is nigh. Purnomo Yusgiantoro, the Indonesian president of Opec, has warned that the cartel will not be able to increase production to bring down prices, the rise in which has been fuelled by uncertainty over the future of Russian oil giant Yukos and attacks on pipelines in Iraq. Better fill up now before we hit $50 a barrel.

The 11 members of Opec - Algeria, Indonesia, Iran, Iraq, Kuwait, Libya, Nigeria, Qatar, Saudi Arabia, the United Arab Emirates and Venezuela - supply more than 40% of the world's oil and have more than 75% of all proven reserves. They have us over a ... well, they've certainly got us where they want us. Yusgiantoro's statement may even be a bargaining ploy. So the answer, surely, is to start looking beyond Opec.

Hampshire may be a good place to start. Last summer, Northern Petroleum struck oil near Winchester, between the A31 and A272, and it thinks the field could be good for 100m barrels. The company is also exploring widely in West Sussex and on the Isle of Wight. That's the spirit. The Campaign to Protect Rural England is objecting to drilling, but let's hope Northern's valiant efforts are not blocked by such stockbroker-belt nimbyism.

And what about Rajasthan? Shell had more or less abandoned prospecting there, but oil minnow Cairn Energy made several major finds this year and reckons Rajasthan could be the new Texas; it has already found fields with an estimated 360m barrels of recoverable oil and is now planning exploration in Nepal. Cairn is run by former Scottish rugby international Bill Gammell; playing rugby for Scotland is the perfect pursuit for unquenchable optimists. Cairn invested $7.2m in the search for oil in Rajasthan; the find could be worth $500m. Gammell was recently named Scottish entrepreneur of the year.

BP's latest Statistical Review of World Energy pinpoints reserves in improbable places: Denmark has 1.3bn barrels, Peru 1bn, Papua New Guinea 400m. Greece looks promising; Kazakhstan has huge potential (though there are fears that drilling could trigger earthquakes); the North Sea is by no means exhausted, with major new finds still being made; there are hopes that substantial reserves will be found in the Falklands; and £35m is being spent on offshore exploration in North Wales. Today Colwyn Bay, tomorrow the world. We should stop panicking and start drilling.

http://www.guardian.co.uk/g2/story/0,,1276141,00.html