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| Nelp-IX norms to give firms more time to explore oil |
| BS Reporter / New Delhi Oct 06, 2010, 00:46 IST |
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The government plans to relax the bidding norms for the coming ninth round of auctioning of oil and gas blocks under the New Exploration and Licensing Policy (Nelp-IX), as the previous round of auctioning failed to generate much interest.
The new norms are likely to give companies more time to undertake exploration by extending the initial exploration phase by one year to five years while also allowing companies that have surrendered blocks to bid for them again.
The companies will also be given the flexibility of drilling the committed number of wells during the entire exploration phase. The Ministry of Petroleum and Natural Gas is working on the revised norms, which will have to be approved by a committee of secretaries before the launch of the ninth round on October 15, said officials.
The initial exploration period would be extended for deepwater blocks and blocks in the north-eastern region to five years, instead of the four years that were stipulated in the eighth round of Nelp bidding. This would be done since blocks beyond the 400 metre bathymetry (deepwater blocks) and those in the North-East are considered difficult areas.
The first exploration phase at all deepwater blocks lasted for five years under the Nelp-VI and Nelp-VII rounds though in the eighth round there was a single exploration period of seven years, divided into an initial period of four years and a subsequent phase of three years.
Operators would also be allowed to drill the committed number of wells at any time during the subsequent exploration period without any stipulation for drilling one additional exploratory well to be drilled in each year of the subsequent exploratory phase, as was the case in Nelp-VIII.
The government also plans to designate blocks in the north-eastern region as well as those in category-III and category-IV basins as “frontier area”.
Besides, bidders who offer to undertake 3D seismic surveys over the entire block will not be required to carry out any 2D surveys on that block. The maximum bid evaluation points kept aside for bidders for 2D seismic survey commitments will be awarded to bidders who commit to carrying out 3D surveys over the entire block.
Of the 70 blocks offered under Nelp-VIII concluded last year, only 36 attracted bids. The government finally awarded 33 blocks, half of which went to public sector explorer Oil and Natural Gas Corporation.
India has so far allotted 235 production-sharing contracts through eight rounds of bidding since 1999. A total of 81 oil and gas discoveries have been made in 23 of these blocks with in-place reserves of over 642 million tonnes of oil equivalent.
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