ONGC withdraws with the 7 blocks of oil and gas offered in the last round of offers
NEW DELHI: State oil and natural gas corporation ( ONGC ) on Thursday he left with the seven blocks of oil and gas offered in the last round of offers that saw only eight offers.
ONGC signed contracts for the seven blocks at an event where oil minister Dharmendra Pradhan and other ministry officials were also present.
These 7 blocks are adding an exploration area of 18,510 square kilometers distributed in three sedimentary basins in India and have a resource potential of approximately 33 billion barrels of oil and oil equivalent gas, he said.
The latest licensing round for allowing companies to explore for oil and natural gas was held on revamped terms but saw only ONGC and Oil India Ltd participating in it. ONGC put in bids for all the seven blocks on offer, while OIL put in an offer for one block at the close of bidding on October 31, 2019.
ONGC was the sole bidder in five blocks in Madhya Pradesh and one in West Bengal and it was locked in competition with OIL in one block in Rajasthan. ONGC walked away with all the seven blocks on superior bids.
According to the General Directorate of Hydrocarbons (DGH), seven blocks were offered on land in the fourth round of the Open Surface Licensing Policy (OALP) with an area of approximately 18,510 km2.
With the culmination of the Round IV tender today (Thursday), we have awarded 94 blocks under the exploration policy in a very short period of time of two and a half years. These 94 blocks cover an exploratory area of approximately 1.36,800 square kilometers over 16 Indian sedimentary basins, Pradhan said. Investors of the 94 blocks have committed 29,270 linear kilometers of 2D seismic survey and 43,272 square kilometers of 3D seismic survey, 369 numbers of exploratory wells, 290 central analyzes to establish bituminous shale resources. This will generate an investment of USD 2.35 billion (around Rs 16,450 million rupees) during the next 3/4 years only in exploratory activities.
In the first three rounds of OALP, an area of approximately 1.18,000 square kilometers was granted, he said, adding that the area granted for exploration is compared to approximately 90,000 square kilometers of area under exploration before OALP.
The fourth round of bidding under OALP had the least number of blocks. While the first round won 110 bids for 55 blocks, the second round attracted 33 bids for 14 blocks. The third round saw 42 bids for 23 blocks. In the previous three rounds together, 87 blocks covering an area of 1.18 lakh km2 have been awarded.
OALP-IV was the first round in renewed terms approved in February 2019.
Unlike previous rounds in which blocks were granted to companies that offer a maximum share of oil and gas to the government, the blocks in small or unexplored category II and III basins are now granted to companies that offer to conduct the exploration program maximum
While the blocks in Madhya Pradesh fall into the Vindhyan Basin, which is a category II basin, the Bengal Purga Basin is a category III area where there has been no exploration so far.
Pradhan said OALP-IV will open two new basins for exploration in the country.
Under OALP, companies are allowed to create areas in which they want to explore oil and gas. Companies can express their interest in any area throughout the year, but such interests accrue three times in a year. Wanted areas are auctioned.
The fifth EoI presentation cycle closed on November 30, 2019, and was followed by the sixth cycle that began on December 1, 2019 and will last until March 31, 2020.
Up to 20,000 square kilometers of the area have been searched in the fifth cycle that will be tendered before March, Pradhan said.