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ONGC inks deals for 7 blocks; Oil India signs up for 4 blocks

Speaking at the signing ceremony, Oil Minister Dharmendra Pradhan said that with the latest bid round, the Centre has over the past four years allocated 1.56 lakh square kilometre of acreage for finding and producing oil and gas

twitter-logoBusinessToday.In | November 17, 2020 | Updated 16:35 IST
ONGC inks deals for 7 blocks; Oil India signs up for 4 blocks
ONGC won signed agreements for seven oil and gas blocks, whilst, Oil India Ltd inked contracts for the remaining four under the fifth bid round of the Open Acreage Licensing Policy

State-owned Oil and Natural Gas Corporation (ONGC) on Tuesday, November 17, signed agreements for seven oil and gas blocks it had won in the latest bid round that saw paltry participation from the private sector companies.

Another state oil producer, Oil India Ltd, inked contracts for the remaining four blocks awarded under the fifth bid round of the Open Acreage Licensing Policy (OLAP).

Speaking at the signing ceremony, Oil Minister Dharmendra Pradhan said the Centre has over the past four years allocated 1.56 lakh square kilometre of acreage for finding and producing oil and gas.

This compares to 90,000 sq km of area awarded in nine rounds of New Exploration Licensing Policy (NELP) and pre-NELP awards in the previous two decades.

Also Read: ONGC's gas revenue hit by $1 billion due to fall in prices

He, however, wanted explorers to expedite the hunt for oil and gas so as to make the nation self-reliant in energy. "You have to exponentially speed it up," he said.

Red tape and multiple permissions needed for exploring and producing oil and gas have in the past led to several slippages in the committed timelines.

"Tell us, if you need more help," Pradhan said, asking explorers to give suggestions on improving the regulatory environment. "Business as usual cannot work."

The minister also wanted the data repository set up by his ministry's upstream nodal agency, the Directorate General of Hydrocarbons (DGH), to be remodelled on lines of the National Geoscience Data Repository (NGDR) of the mines ministry.

He wanted the data repository, which houses geological data of Indian sedimentary basins, to become an independent profit centre.

The NGDR is a public-private initiative for all non-coal and non-fuel resources. The government had offered 11 blocks for exploration and production of oil and gas in OLAP-V.

A total of 12 bids, including seven bids by ONGC and four by OIL, were received for the 11 blocks on offer at the close of bidding on June 30. Invenire Petrodyne Ltd was the only private bidder for one block.

While ONGC was the sole bidder for six blocks, OIL was the lone bidder in all the four blocks it bid for.

ONGC won all six blocks where it was the sole bidder and also the one block where Invenire Petrodyne had bid.

Also Read: India's oil and gas sector to see $300 billion investment by 2030

The previous bid round, OALP-IV, too had seen just eight bids coming in for seven blocks on offer. ONGC had walked away with all the seven oil and gas blocks on offer.

Prior to OALP-V, the government had awarded 94 blocks in four OALP bid rounds since 2017. These 94 blocks cover an exploratory area of about 1,36,790 sq km over 16 Indian sedimentary basins.

In the latest bid round, about 19,800 sq km of the area was offered for bidding, he said.

At the time of the launch of OALP-V, DGH had stated that the round is expected to "generate immediate exploration work commitment of around USD 400-450 million."

Of the 94 blocks awarded in the first four rounds of OALP, Vedanta has won the maximum at 51. Oil India Ltd has got 21 blocks and ONGC another 17.

After OALP-V, ONGC's tally has gone up to 24 and that of OIL to 25.

Under OALP, companies are allowed to carve out areas they want to explore oil and gas in. Companies can put in an expression of interest (EoI) for any area throughout the year, but such interests are accumulated thrice in a year. The areas sought are then put to auction.

(With inputs from PTI.)

Also Read: Oil India discovers natural gas in Assam's Tinsukia

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