Essar Oil spurts 1.53% to close at Rs 145.70 on BSE on the back of company's plans to lay a 160-km pipeline from Durgapur to Kolkata in order to transport gas from its CBM blocks to consumers in West Bengal.

Essar Oil has applied to the sectoral regulator, Petroleum and Natural Gas Regulatory Board (PNGRB) in order to allow to lay a 24-inch pipeline from Durgapur, as per the company's January 13 application to the regulator.

The company is likely to commence the production of gas found below coal seams, called Coal Bed Methane (CBM), from its Raniganj block in West Bengal this quarter.

The initial output is likely in the range of 9,000-10,000 cubic meters per day with peak production of 3.5 million standard cubic meters envisaged in mid-2013.

The stock hit an intraday high of Rs.147.7 till now, as against the 52-week high of Rs.194.The stock hit a low of Rs.143.8 during the day. The stock had hit a 52-week low of Rs.112.25 on April 8, 2009.

The stock opens at Rs.144.9 at BSE. The total traded volume of the scrip on BSE till now stood at 1615612.

Meanwhile today, the BSE Sensex closed up by 28.65 points, or 0.16% , at 17970.02.

The NSE Nifty closed higher by 8.65 points, or 0.16% , at 5374.65.

Essar Oil has an equity capital of Rs 1,202.00 crore as of 2009 Dec. The face value per share is Rs 10. At the current price of Rs 145.7, the P/E multiple stood at 0 with book Value of 28.91 and P/BV at 5.04.

The total shareholding pattern of the company as on Dec 2009 stood at Promoters- 18.14%, Institutional Investors- 4.37%, General Public- 5.31% and other investors- 72.18%.

Considering the current price of Rs. 145.7 at 4:00:00 PM , the stock had underperformed the market over the past one month till 07/04/2010 declined 2.21% as compared to the Sensex's return of 5.07% and NSE Nifty's 5.07 % returns.

Considering the current price of Rs. 145.7 at 4:00:00 PM , the stock had underperformed the market over the past one quarter till 07/04/2010 fell 7.08% as compared to the Sensex's return of 2.45% and NSE Nifty's 2.45 % returns.

Meanwhile, Shishir Agrawal, Head Essar Exploration Production Division, in the application to PNGRB said that it propose to supply CBM in Kolkata region in order to sell the entire production potential of the block.

In order to execute the project, a special purpose vehicle would be set up, Essar said.

Moreover, the pipeline may also be used in order to transport gas from Essar's Rajmahal CBM block in neibouring Jharkhand.

Agrawal said that in Raniganj, 15 test wells have already been drilled and there are plans of 500 more.

Essar has suggested a pipeline capacity of 4 mmscmd considering PNGRB requirement of having 33 per cent excess capacity for leasing out to third parties.

Meanwhile, Essar is making an investment of $300 million in Ranigang block that has in-place resource of 4.6 trillion cubic feet and recoverable resource of around 1 Tcf.

On the other hand, Essar Oil last month had said that it will seek the nod of the shareholders in order to raise $1.7 billion (about Rs 7,700 crore) through the issue of securities in the international markets to finance its various expansion plans.

The amount is the part of the company's fund-raising plan of $2 billion, which was approved by its shareholders in December 2007.