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ECS overrules DGH recommendations on NELP blocks

The Empowered Committee of Secretaries reasoned that if a company was qualified to bid and had bid the highest, it should be awarded the block.

india Updated: Nov 23, 2006 18:47 IST

An Empowered Committee of Secretaries on Thursday overruled recommendations of upstream regulator Directorate General of Hydrocarbons(DGH) on award of exploration blocks under NELP-VI and favoured allotting 12 blocks to state-run oil firm ONGC.

The DGH in its recommendation for award of blocks offered in the sixth round of auction under the New Exploration Licensing Policy (NLEP) had opined against awarding 12 deep sea blocks to ONGC due to its "poor" track record.

However, the ECS, comprising officials from the ministries of petroleum, finance and law, did not agree with its suggestions, official sources said.

The consortium of ONGC-GSPC-HPCL-GAIL was clear winner in 11 deep sea blocks while ONGC-Cairn India Ltd-Tata were ranked number one in a Kerala-Konkan basin block. But DGH was against award of the blocks to the consortium and recommended "award by negotiations to an international company."

DGH had also suggested that Reliance Industries Ltd, the second highest bidder in most of these blocks,should be given these contracts.

Sources said the oil ministry opposed DGH recommendations on ONGC, saying if a company was qualified to bid and had bid the highest, it should be awarded the block.

Of the 21 deep sea block offered in NELP-VI, Reliance had emerged clear winner in seven - two in Krishna Godavari basin and five in Mahanadi basin. Santos was recommended award for two North-East-Coast (NEC) blocks.

Of the six shallow water blocks, one each has been recommended for ONGC, Focus Energy, Cairn-ONGC-Tata and ONGC-BG while two blocks have been suggested for the consortia of GSPC-IOC-GAIL-HPCL-Petrogas.

First Published: Nov 23, 2006 18:47 IST