Rules changed for non-commercial acreage
The Directorate General of Hydrocarbon (DGH) has deferred by one month the last date for bidding for the 14 oil and gas exploration blocks offered in the second round of Open Acreage Licensing Policy (OALP).
Bids for the 14 blocks offered in OALP-II bid round, covering an area of 29,333 sq km, were to close on 12 Mar 2019.
Bid submission closing date for OALP Bid Round-II stands extended up to 10 April 2019, the DGH said on 12 Mar 2019 without giving reasons for extending the deadline.
But in a bid to attract the elusive private and foreign investments in hydrocarbon sector, major changes have been made to the oil and gas exploration permits by not taking any share of profit on production from less explored areas.
The new policy provides for different rules for areas that already have producing fields and areas that are yet to show a commercial hydrocarbon discovery.
This is a breakaway from the two-and-a-half decade-old practice of having a uniform contractual regime for all sedimentary basins.
All acreages or blocks will be bid out based on the exploration commitment of a bidder in the future while giving marketing and pricing freedom to hydrocarbon producers which has been approved by the Cabinet on 28 Feb 2019.
With over 80% oil and gas imports to meet insatiable energy demand, which is also a big financial burden, India has failed to attract private and foreign investors to sedimentary basins.
Lack of geological data has also been a big hindrance in attracting investors, some complaining the challenges of conducting geophysical surveys, especially so in difficult terrains and tribal conflicts, according to industry observers. fiinews.com