The Hindu : Business : 100 oil blocks to be offered in February

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Tuesday, Dec 23, 2008
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100 oil blocks to be offered in February

Special Correspondent

Fourth round of auction of coal bed methane (CBM) blocks will also be launched: Deora

Efforts on for simplifying bid evaluation
Natural gas production to double from 80 mscm

— PHOTO: V. SUDERSHAN

ENERGY SECURITY: Union Minister for Petroleum and Natural Gas Murli Deora (second from right) with Secretary, R. S. Pandey (second from left), witnessing the signing of production sharing contracts for NELP-VII in New Delhi on Monday.

NEW DELHI: Stating that India was well on its path for achieving “energy security”, the Central Government on Monday announced that it would launch its biggest-ever auction of oil and gas exploration blocks NELP-VIII in February with almost 100 blocks likely to be put on offer for international bidding.

“It would be our endeavour to launch New Exploration Licensing Policy-VIII (NELP-VIII) in the first quarter of 2009,” Petroleum and Natural Gas Minister Murli Deora said at the signing ceremony of PSCs for NELP-VII. However, officials said that the next round would be held around February putting around 100 blocks on auction. The nation is looking at using lower rig rates and oil field services that are likely to result from fall in international oil prices and global recession to comb the unexplored areas and cut import dependence.

So far, 206 blocks have been awarded under seven rounds of bidding. Petroleum Secretary, R. S. Pandey, specifically said that the next round would come by February with around 4 lakh sq. km. of area roughly divided into more than 100 blocks would be on offer. NELP-VII was the largest round so far with 1.50 lakh sq km offered.

Mr. Deora said the fourth round of auction of coal bed methane (CBM) blocks would also be launched. A total of 26 coal blocks for exploiting gas lying below coal seams have been awarded in the previous three CBM rounds.

Mr. Deora said the Ministry had already started interacting with all the stakeholders for simplifying bid evaluation criteria and production sharing contracts (PSCs) for the forthcoming rounds of NELP and CBM policy. With exploration development efforts made under NELP, natural gas production is likely to be doubled from its present level of about 80 million standard cubic metres (mscm) a day by the end of the XI Plan.

PSCs signed

Putting an end to the seventh round of New Exploration Licensing Policy (NELP), leading oil and gas companies, including Oil and Natural Gas Corporation (ONGC), BHP-Billiton-GVK Power combine, Essar Exploration and Production, Gas Authority of India and Reliance Industries-British Petroleum joint ventures have signed production sharing contracts (PSCs) for 44 oil and gas blocks at an estimated investment of $1.5 billion.

The PSCs were signed at a function presided over by the Union Petroleum and Natural Gas Minister, Murli Deora, and Petroleum Secretary, R. S. Pandey. State-run ONGC and partners signed PSCs for the maximum number of 20 oil and gas exploration blocks they won in India’s largest ever international bid round that closed on June 30. First-timers BHP Billiton and GVK Power inked agreements for seven deep sea blocks. Reliance Industries forged an alliance with British Petroleum but managed only one Krishna-Godavari basin block.

The Phase-I investment commitment includes $321.15 million for exploration in deep sea, $598.255 million for exploration in shallow waters and $572.75 million for on-land blocks.

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