Production sharing contracts need flexibility: Oil secretary

Also says there was an urgent need to expand India's 13,000 kilometer long gas pipeline network comparing it with that of China

Production Sharing Contracts (PSCs) operating in the upstream oil-and-gas sector in India need to be more flexible, petroleum secretary Vivek Rae has said.

“We have to fix the rigidity,” he said at an annual event here, calling for adoption of international standards. He also said there was an urgent need to expand India’s 13,000 kilometer long gas pipeline network comparing it with that of China.

While Rae said there is nothing wrong with PSCs, petroleum ministry’s Joint Secretary-Exploration Aramane Giridhar, speaking at the same event, said the PSC is “no good and has to go”, according to a release issued by the organizer, Observer Research Foundation.

He argued the stakeholders should have freedom to take appropriate decisions without waiting for approvals from the regulator – Petroleum and Natural Gas Regulatory Board (PNGRB).

Oil & Natural Gas Corp (ONGC) Chairman Sudhir Vasudeva, who was also present on the occasion, said the huge subsidies given to consumers is a burden on companies and must be removed.