India conducted its ninth and last bidding round under the previous New Exploration and Licensing Policy in 2012 awarding 256 blocks to exploration companies. "A total of 67 discovered small fields will be offered in 46 contract areas through the new revenue sharing model," the upstream regulator said.
Although the investment sentiment in the oil sector has been impacted by low crude oil prices, Vedanta-owned Cairn India Ltd, the private operator of India's largest onland oil and gas block in Rajasthan, said it would study the data of available blocks on offer for participation in the bid round. "We will evaluate data from the blocks being offered, to gain further understanding, for firming up our strategy for the same," Cairn India Chief Executive Mayank Ashar told Business Standard.
He added that further to the set of policies announced recently to accelerate investments in the oil & gas sector by the government, the reported launch of the 'discovered small fields bid round' later this month is a welcome move and the company sees a structure and process in these "progressive steps" being taken by the government.
Of the 67 blocks on offer, 28 discoveries are in Mumbai offshore and 14 are in the Krishna Godavari basin off the Andhra coast. Also, 10 discoveries are located in the Assam shelf area, according to the oil ministry.
The discoveries were relinquished by ONGC and OIL in 2012 as they could not develop them because of small size and unviable price. The discoveries hold in-place reserves of 88 million tonnes (mt) of oil and oil equivalent gas. This includes D-18 in Mumbai Offshore as the biggest discovery that alone holds 14.7 mt reserves.
The new revenue-sharing regime will replace the controversial production sharing contract model that allowed all investments to be recovered from sale of oil and gas before profits are shared with the government.
The ministry has announced under the new policy, a single licence for exploitation of all forms of hydrocarbons will be issued and operators will have the freedom to sell oil and gas on arms-length market price.