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State-owned ONGC and Vedanta Ltd today emerged as the biggest bidders for oil and gas blocks as they put in 41 out of 57 bids in India's maiden open acreage licensing regime auction that was shunned by several major global and domestic players.
Oil and Natural Gas Corp (ONGC) put in expression of interest to explore for oil and gas in 41 areas while Vedanta's oil unit, Cairn India, sought rights over 15 areas, sources privy to the development said.
India in July opened 2.8 million sq km of sedimentary basins for oil and gas exploration under the Open Acreage Licensing (OAL) regime in a bid to raise domestic production and cut excessive dependence on imports.
It allowed companies to select any area that is presently not under any production or exploration license.
Sources said today was the last date for submission of EoI in the first cycle of bidding under OAL.
At least 57 expressions of interest (EoIs) have been received, with maximum 45 coming in the month of July. One bid came in September and seven in October.
BP plc team visited data room but has not put in any bids so far, they said. Reliance Industries Ltd also skipped the auction.
OAL replaces the old system of government carving out areas and bidding them out. OAL allows investors to carve out their own areas and put in an EoI. Once an EoI is received for an area, it is put on competitive bidding and any company offering the government maximum share of oil and gas is awarded the block.
OAL was packaged with Hydrocarbon Exploration and Licensing Policy (HELP) that guaranteed marketing and pricing freedom and moved away from production sharing model of previous rounds to a revenue sharing model where companies offering maximum share of oil and gas to government are awarded the block.
Till now, the government has been selecting and demarcating areas it feels can be offered for bidding in an exploration licensing round.
So far 256 blocks had been offered for exploration and production since 2000. The last bid round happened in 2010. Of these, 254 blocks were awarded. But as many as 156 have already been relinquished due to poor prospectivity.
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