India offers 55 oil and gas blocks for exploration under new licensing policy

India has put up a record 55 oil and gas blocks on auction, with a gross acreage of 59,282 sq km, under the new Hydrocarbon Exploration and Licensing Policy (HELP), in the first bid round in eight years.

Each block on offer has been carved out by prospective bidders under the open acreage licensing (OAL) of the new Hydrocarbon Exploration and Licensing Policy (HELP), minister of petroleum and natural gas, skill development and entrepreneurship Dharmendra Pradhan said launching the round

For the first time in India, 55 bidder selected blocks, each carved out by prospective bidders themselves in promising basins with an area of 59,282 sq km. This is the largest offering of acreages the government has announced in the past eight years.

During the event, Pradhan also launched the e-bidding portal and the notice inviting offer (NIO). The e-bidding portal is a fully safe, secured and transparent platform wherein the bidders can submit their bids from anywhere in the world. In parallel, 'DGH OneTouch' mobile application was also launched which would act as a one stop solution for accessing information about DGH, policy initiatives and other relevant information on the move.

Delivering the keynote address, petroleum minister Dharmendra Pradhan highlighted the growing positive industry sentiments and signs of steadfast progression of India's oil and gas sector.

He mentioned that the hydrocarbon resource reassessment study undertaken for the first time in two decades has indicated a significant increase (~50 per cent) in resource estimation. Also, he shared his thoughts on future endeavours of further strengthening the E&P ecosystem by reforms focused on boosting the indigenous production of oil and gas by infusion of world class technology and collaboration with global oil and gas companies.

He mentioned the scale of proactive reforms being enacted at MoPNG major ones being: Introduction of Hydrocarbon Exploration and Licensing Policy (HELP), Discovered Small Field (DSF), National Data Repository (NDR), Hydrocarbon Resource Reassessment study. The minister also took time to brief the media to share the advances and future strategies in the Indian E&P sector.

Award of blocks would be done on the basis of the highest share of oil and gas to the government as well as the bidder's commitment to do maximum exploration work by way of shooting 2D and 3D seismic survey and drilling exploration wells.

"Last date of bidding is April 3," Pradhan said, adding that the blocks would be awarded by June or July.

Increased exploration would lead to more oil and gas production, helping the world's third largest oil importer to cut import dependence.

Prime Minister Narendra Modi has set a target of cutting oil import bill by 10 per cent to 67 per cent by 2022 and to half by 2030.

India had in July last year allowed companies to carve out blocks of their choice with a view to bringing about 2.8 million square kilometres of unexplored area in the country under exploration.

Under this policy, companies are allowed to put in an expression of interest (EoI) for prospecting of oil and gas in any area that is presently not under any production or exploration licence. The EoIs can be put in at anytime of the year but these are accumulated twice annually.

The blocks or areas that receive EoIs at the end of the cycle are put up for auction with the originator or the firm that originally selected the area getting a 5-mark advantage.

The 55 blocks have a total area of 59,282 sq km.

This compares to about 1,02,000 sq km being under exploration currently.

State-owned Oil and Natural Gas Corp (ONGC) and Cairn India, a unit of Vedanta Ltd, had put in 41 out of 57 bids received in November last year. Private player Hindustan Oil Exploration Co (HOEC) bid for one area in a round.

Of the 57 EOIs put only 55 blocks were cleared for bidding after eliminating areas that are under no-go zone or overlapping with existing mining lease.

So far 256 blocks had been offered for exploration and production since 2000 while 254 blocks have been awarded for exploration. However, about 156 blocks stand abandoned due to poor prospectivity.