The Union Home Ministry has “advised” the Petroleum and Natural Gas Ministry to not give exploration and production contracts for oil and gas blocks to Chinese companies for security reasons.

In its advisory, the Home Ministry said some of the blocks proposed for oil and gas exploration in Rajasthan, Punjab and Gujarat were located close to the border with Pakistan.

“China is already involved in developing various projects in Pakistan, including those located close to the Indo-Pakistan border. It is advisable that Chinese companies are not given contract for exploration activities in such blocks and also in blocks close to sensitive defence installations, strategic assets and in the north-east,” the advisory said.

The Home Ministry said the possibility of terrorists and sea pirates targeting proposed oil installations in the Kerala-Konkan region cannot be ruled out, though there was no specific threat at the moment.

For blocks in the Mahanadi-NEC basin in Odisha, it said as sensitive DRDO installations were in close proximity to the proposed blocks, auction was not advisable.

“If exploration activity has to take place, it should be by an Indian company, preferably an Indian public sector undertaking,” the Home Ministry advised.

The Ministry also wanted restrictions to be observed while giving out sub-contracts. “It would be pertinent to mention that these restrictions may be observed in respect of sub-contracts, leasing the work, consultancy, procurement of equipment and utilising services for repair and maintenance of the equipment too,” the advisory said.

The next round of New Exploration Licensing Policy (NELP) is scheduled to be unveiled next month.

The Home Ministry’s views came in response to an inter-Ministerial note by the Petroleum Ministry, seeking clearances for 55 to 60 blocks, which will be on offer to domestic and international players.