67 oil & gas fields up for global bidding on simpler terms
After a gap of more than 4 years, India today offered 67 oil and gas fields for auction through international bidding on simpler rules along with pricing and marketing freedom. Oil Minister Dharmendra Pradhan said bidding for the Discovered Small Fields Bid Round will open on July 15 and last date of bidding is October 31.business Updated: May 25, 2016 15:27 IST
After a gap of more than 4 years, India today offered 67 oil and gas fields for auction through international bidding on simpler rules along with pricing and marketing freedom.
Oil Minister Dharmendra Pradhan said bidding for the Discovered Small Fields Bid Round will open on July 15 and last date for bidding is October 31.
Explaining the simpler regulatory process for this round of auction of natural resources, the oil minister said: “Hopeful with improved regulatory process, investors will make the most of it...Rs 70000 crore worth of natural resources to be unlocked via auction of small fields.” The fields offered have 625 million barrels of oil and gas reserves.
This round of auctions are for the idle discoveries of state-owned ONGC and Oil India Ltd and of these, 28 discoveries are in Mumbai offshore and another 14 are in the prolific Krishna Godavari basin. As many as 10 discoveries are the Assam.
The government took away these discoveries from ONGC as it could not develop them because of unviable price.
But in the bidding round, the government is offering complete pricing freedom and ONGC too can bid to get back its discoveries.
The biggest discovery among the lot is the D-18 in Mumbai Offshore that alone holds 14.78 million tonnes of oil reserves.
Among the gas discoveries, the largest is ONGC’s B-9 find in the offshore Kutch basin that has an reserves of 14.67 bcm.
Spelling out salient features of the Marginal Field Policy, sources said the auction will be done on a new revenue sharing model where bidders will be asked to quote the revenue they will share with the government at low and high end of price and production band.
The new revenue sharing regime will replace the controversial Production Sharing Contract (PSC) model where oil and gas blocks are awarded to those firms which show they will do maximum work on a block.
Also, a single licence for exploration and exploitation of conventional and non-conventional hydrocarbons will be issued and operators will have freedom to sell oil and gas on arms length market price, Pradhan said, adding that there would be no cess on crude oil.
Last exploration licensing round concluded in March 2012. That was the ninth round of auctions under the New Exploration Licensing Policy (NELP). A total of 256 block were awarded in the nine rounds of NELP.
First Published: May 25, 2016 15:20 IST