The Reliance group of industries has bagged exploration contract for 12 of the 25 oil search blocks awarded by the government under the New Exploration Licensing Policy. Reliance industries had bid for 14 blocks and was the lone contender for four of the 12 blocks.
The Cabinet Committee on Economic Affairs, or CCEA, approved bids for 25 of the 27 blocks offered under NELP. These include bids for two onland blocks, seven deepwater offshore blocks and 16 shallow water blocks. Bids for two onland blocks were rejected, as they were incomplete and non-responsive. Deepwater blocks beyond 400-metre isobath were offered for the first time.
The government awarded the remaining 13 blocks to oil majors such as Oil and Natural Gas Corporation, Indian Oil Corporation, Oil India Ltd, Gazprom of Russia, Mosbacher Energy of the US and Cairns Energy of the UK. The government received 45 bids from 21 companies, of which 10 were foreign companies, six Indian private companies and five state-run companies.
The ministry of petroleum and natural gas will sign the production sharing contracts with legal vetting from the ministry of law. Companies will be required to pay petroleum exploration licence fees and rentals.
The Indian government had invited bids for 48 oil blocks identified under the NELP. However, bids were received for only 27 blocks. The remaining blocks failed to attract bidders, as the directorate general of hydrocarbons had not updated the relevant information at the time of the bidding.
The new policy for oil exploration however, has failed to attract international oil majors, who have distanced themselves from bidding. The new policy promises a seven-year tax holiday and exemption from various levies. It also provides no-signature discoveries and production bonus payments.