Houston roadshow for NELP-VIII and CBM-IV a big draw news
22 August 2009

A total of 52 companies, including 27 oil exploration and prospecting (E&P) companies and 25 non-E&P companies - both Indian and overseas - participated in the second roadshow for the NELP-VIII and CBM-IV, held in Houston, US, on 20 August.

Some of the major E&P companies which participated in the roadshow included Conoco Philips, Noble Energy, Exxon Mobil, Petrotel, BHP Billiton, Devon Energy, Hess Corporation, BP, BG, Apache, TOTAL, RIL and ONGC.

India is offering 70 oil and gas blocks under the eighth round of the New Exploration Licensing Policy (NELP) and 10 coal bed methane blocks (CMB) under the fourth round of bidding for global competitive bidding.

The roadshow was part of a series of promotional exercises being organised by the government at various places, starting with the one in Mumbai on 8 August, inviting exploration and production companies and prospective investors to avail of the highly attractive investment opportunities being offered under NELP-VIII and CBM-IV.

A roundtable conference was also held by US-India Business Council and the Department of Energy of the ministry of petroleum and natural gas, on 21 August, at the Petroleum Club, Houston.

Seven-year tax holiday
"The policy environment is attractive and an investor friendly production sharing contract (PSC) regime exists," minister of state for petroleum and natural gas Jitin Prasada told the participants. "The Government of India has assured seven-year tax holiday to commercial production of both oil and gas from blocks under NELP-VIII and CBM-IV bid rounds," he added.

About 20 companies, including major oil and gas companies like Cheveron, British Gas, BHP-Billiton, British Petroleum, Exxon Mobil, Hess Corporation, attended the roundtable.

Prasada said the recent huge discoveries have significantly changed perceptions about the geological prospectivity of India's sedimentary basins.

Currently, 50 per cent of Indian sedimentary basins are under exploration against the XI plan target area under exploration of 80 per cent.

More than two dozen international oil companies, including British Gas, British Petroleum, Shell, ENI, Gaz de France, BHP Billiton, Santos, Gazprom, Nafotgaz, Cairn Energy, Niko Resources, Hardy Exploration & Production, are currently working in India.

Since the NELP regime was adopted 10 years ago, about two dozen E&P operators have been awarded exploration blocks of which 50 per cent are overseas companies.

Seventy-one oil finds in 10 years

Invitation of bids under NELP-VIII comes in the backdrop of 71 oil and gas discoveries made in 21 exploration blocks, over the past 10 years, DN Narasimha Raju, joint secretary (exploration) in the ministry of petroleum and natural gas, said at the round table.

"There has been accretion of in place hydrocarbon reserves of more than 600 million metric tonne of oil equivalent. Under the NELP regime, major natural gas production in KG basin commenced from April 2009. With this, gas production in India would be doubled as against production of 2008-09," he said.

Actual investment in NELP rounds for exploration so far is around $11.9 billion ($ 5.3 billion in exploration and $ 6.6 billion in development) as against the committed investment of around $10 billion, he said.

Further, he said, commercial production of CBM commenced in Raniganj block with effect from July 2007.

The minister also gave details of the changes on bid evaluation criteria, fiscal and contractual terms for NELP-VIII and CBM-IV bid rounds that have been brought about to make the system simpler and also to meet the requirements of the industry.

Doug Hengel, deputy assistant secretary of energy of the US government asked E&P companies to invest in India and become partner in its quest for exploration and exploitation of hydrocarbons.

Some of the major E&P companies operating in India such as ONGC, British Gas, British Petroleum and RIL made presentations to demonstrate their success stories in India's E&P sector.

Consultancy firm Ernst & Young made a presentation to highlight the investment climate and their perception about oil and gas taxation regime in India while the Confederation of Indian Industry made a presentation about its perception on India's business climate and investment opportunities.

To facilitate data viewing by prospective E&P companies, the government has opened a data centre at NOIDA, near New Delhi and at overseas centres like Houston, London, Calgary and Perth. The data will be available on request. The data for NELP-VIII &CBM-IV can be viewed by companies at any of these centres as well as online through website and thereafter interested companies may purchase data.

Promotional roadshows for NELP-VIII and CBM-IV have been planned also at Calgary (24-25 August 2009) London (8-9 September), Perth (22 September) and Brisbane ( 24-25 September).

The bid closing date for NELP-VIII and CBM-IV is 12 October 2009. The NELP-VIII and CBM-IV bid rounds are expected to get a very good response from E&P companies in view of the excellent investment opportunities being offered and the government's commitment to complete the process with in a reasonable time and in a transparent manner.

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Houston roadshow for NELP-VIII and CBM-IV a big draw