Petroleum minister Dharmendra Pradhan on Tuesday urged domestic oil and gas producers to rope in international oil majors to bring in new technology to the sector.
He was addressing the contract signing ceremony of the fifth bid round under the Open Acreage Licensing Policy (OALP). Under the OALP round V, state-run Oil and Natural Gas Corporation (ONGC) has won seven out of 11 geographical areas on offer, while Oil India (OIL) won the remaining four blocks.
Pradhan also indicated the ministry of petroleum and natural gas is planning to come up with a separate body or a company for data management in the sector. This new entity will be similar to the Mineral Exploration Corporation (MECL), the minister added.
OALP Round V is expected to generate immediate exploration work commitment of around $400-450 million. The 11 blocks under this round are spread across eight sedimentary basins and include eight on-land blocks (six in Category I basin and one each in Category II and III basins), two shallow-water blocks (one each in Category I and II basins), and one ultra-deepwater block (Category I basin). The current round has opened up approximately 19,800 square (sq) kilometre (km) for investors.
ONGC has won blocks in Bengal-Purnea, Cambay, Gujarat Kutch, Gujarat Saurashtra, and Mumbai basins. On the other hand, OIL won two blocks each in Assam (Assam Shelf and Assam Arakkan) and Rajasthan. This is the second round of auctions in the current year.
All seven blocks that were on offer under the fourth round of OALP were awarded to ONGC in January. The round added another 18,510 sq km to the total exploration area of the country. Of the seven blocks, five are located in Madhya Pradesh, while one block each in Rajasthan and West Bengal. The seven blocks are spread over three sedimentary basins, with resource potential of approximately 33 billion barrels of oil and oil equivalent gas.
An area of 136,800 sq. km has already been awarded under OALP I, II, III, and IV. The first four rounds are expected to generate an investment of approximately $2.35 billion over the next three to four years in exploratory work alone.
The Hydrocarbon Exploration and Licensing Policy, under which OALP blocks are awarded, adopts the revenue-sharing contract model. As a step towards ease of doing business, it comes with attractive and liberal terms like reduced royalty rates, no oil cess, marketing and pricing freedom, round-the-year bidding, freedom to investors for carving out blocks of their interest, a single licence to cover both conventional and unconventional hydrocarbon resources, exploration permission during the entire contract period, and an easy, transparent, and swift bidding and awarding process.