India has joined a select league of nations that offer areas for exploration and production of oil and gas round the year on liberal fiscal terms including marketing and pricing freedom.
Oil Minister Dharmendra Pradhan today inaugurated India’s maiden National Data Repository (NDR), which stocks information on hydrocarbons prospects of 3.14 million sq km of sedimentary basins. With this, India has switched over to the Open Acreage Licensing (OAL) regime where companies can choose areas they want to explore, he said. Pradhan said that the launch of NDR and OAL is a historic occasion in the history of India’s Hydrocarbon Industry. Under OAL, companies can visit NDR and look at vast seismic data of currently producing fields and explored areas as also those of unexplored areas.
From the areas that are not under any licensee, they can then carve out an area suitable to them and evince interest in doing exploration and production. Once an area is selected, the government will put it up for bidding and any firm offering the maximum share of oil or gas produced from the area would be awarded the block, he said. Till now, the government has been selecting and demarcating areas it feels can be offered for bidding in an exploration licensing round.
Pradhan virtually dubbed the New Exploration Licensing Policy (NELP), under which 256 blocks have been offered for exploration and production since 2000, as a failure, saying “the total production of oil and gas from NELP blocks is equivalent to only three days of India’s oil consumption”.
