KOLKATA (miningweekly.com) – International oil and gas exploration and production (E&P) majors have stayed away from the first round of India’s oil and gas fields auction.
According to the sector regulator, Directorate General of Hydrocarbons (DGH), 110 bids have been received for 55 onshore and offshore oil and gas blocks, with bids put in by domestic E&P majors, while foreign players decided to give it a miss.
According to a statement issued by the regulator, Anil Agarwal-controlled Vedanta has put in bids for all 55 onshore blocks on offer, while national E&P major, ONGC Limited has bid for 37 blocks. Government-owned Oil India Limited submitted 18 bids, while its gas infrastructure provider bid for six blocks.
Other government companies bidding for blocks included oil refiner-marketer, Indian Oil Corporation and Bharat PetroResources.
Domestic private companies bidding for the blocks included Vedanta, Selan Exploration, Hindustan Oil Exploration and Sun Petrochemicals.
However, India’s largest private sector company, Reliance Industries, with a business portfolio including E&P operations, refining and petrochemicals has not put in bids in the first round of the auction under the newly unveiled Open Acreage Licensing Policy (OALP).
There was no official comment on the lack of response from international E&P companies. Industry insiders privately maintained that regulatory constraints and uncertain geological data possibly led to global majors staying away from the auction.
Of the 46 onshore and 9 offshore blocks on offer under OALP, 92 bids were received by the government for onshore blocks, while offshore blocks received 18 bids, according to DGH.
“The government would endeavour to award these blocks by June 2018 to expedite the exploration activities to establish some of the huge prognosticated conventional hydrocarbon resources in the ‘yet to find' category in India,” a DGH statement said.
The bids would not be evaluated on the basis of a minimum work programme and revenue offered to the government.
Under the new OALP programme, successful bidders would be offered a single licence for all hydrocarbons under simplified revenue sharing contracts with full marketing and pricing freedom. The operators with winning bids would have the option to choose between a petroleum operations contract, which is valid for eight years exploration and 20 years of development and production, or a reconnaissance contract, which has a three-year validity.
Successful bidders could migrate from a reconnaissance contract to petroleum operations contract.