Govt okays relaxing production sharing contracts of Pre-Nelp, NELP blocks

Sops will give relief to companies like ONGC and Oil India on sharing of royalty and cess in pre-Nelp exploration blocks

The Union Cabinet on Wednesday eased the policies related to hydrocarbon exploration further by relaxing production sharing contracts (PSC) of Pre-New Exploration Licensing Policy (Nelp) and Nelp blocks. 

This includes giving relief to companies like ONGC and Oil India (OIL) on sharing royalty and cess in pre-Nelp exploration blocks. From payment of 100 per cent royalty, these companies will now have to pay an amount depending on their equity in the project and the same has been made cost recoverable with a prospective effect. 

This will be applicable to 28 exploration blocks awarded to private companies between 1980 and prior to implementation