The cabinet committee on economic affairs (CCEA) on Thursday approved the award of 44 out of the 45 oil and gas blocks that received bids under the seventh round of auctions under the New exploration Licensing Policy (NELP VII).

Oil and Natural Gas Corporation (ONGC) along with its partners and first timers BHP Billiton-GVK Power bagged the maximum number of blocks. The latest round of oil block auctions is expected to attract $1.5 billion investment.

CCEA did not approve the award of one block in western offshore as it received a single bid (from Cairn Energy) which was considered too low, petroleum secretary R S Pandey said. The contracts for NELP VII will be signed with in a month, Pandey said.

Cairn India, a unit of UK explorer Cairn Energy Plc, had not offered the government an attractive enough share of potential production, or profit petroleum.

The terms offered by Cairn, the sole bidder for the block, "would be detrimental to the government's interest in future in terms of profit petroleum", the statement said.

The ministry of petroleum and natural gas will soon sign production sharing contracts with the licensees. The 44 blocks awarded also include nine Type-S blocks and five Mumbai Basin Type-A deepwater blocks viz., MB-DWN-2005/2, 4, 5, 7 & 9.

The production sharing contracts (PSCs) for 44 blocks under NELP – VII are likely to be signed within a month. Total investment commitment for phase – I of exploration for these 44 blocks is about $ 1.5 billion. It is expected that the award of the blocks under NELP – VII will result in more discoveries, further investments in development of oil fields leading to higher reserves accretion and eventually, production of oil and gas.

The government had offered 57 exploration blocks in the latest licensing round. It did not receive bids for 12 blocks.