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Ramesh Sharma

Empty chairs: The venue of NELP-VIII and CBM-IV bidding wears a deserted look in the Capital. The bids for inviting oil and gas exploration companies to participate in the hydrocarbon exploration business closed at noon on Monday. —

Our Bureau

New Delhi, Oct. 12 The latest and most ambitious oil and gas auction round evoked poor response with only 36 of the 70 blocks offered receiving bids.

The subdued participation was attributed to the ongoing gas dispute between the Ambani brothers that has questioned the sanctity of the production sharing contract (PSC), coupled with the impact of the economic slowdown.

To the rescue came public sector oil exploration company ONGC, which swept the NELP-VIII auction, according to provisional results, bagging 17 blocks (operator as well as consortium partner). The Government received 76 bids for 36 blocks out of 70 put on offer under NELP-VIII and 26 bids for eight blocks out of the 10 offered under Coal Bed Methane (CBM-IV). For 16 deepwater blocks, 15 shallow water blocks and three on-land blocks, no bids were received.

Reliance Industries was conspicuous by its absence in the oil and gas bids, though it bid for one CBM block, which slipped out of its hands. In CBM, Essar Oil bagged one, with the remaining seven going to Deep Industries.

Among the foreign players were BHP Billiton of Australia, and BG of UK. Besides Cairn India, some of the other players that emerged winners were Oil India Ltd and Jubilant.

The S-type (small size) blocks, a new category introduced in NELP-VII to attract new players, came to the rescue in the ongoing round also. For the 10 such blocks put on offer, 37 bids were received.

Speaking to newspersons, Mr R. S. Pandey, Petroleum Secretary, said, “You might think that the number is less but looking at the performance globally this year, given the economic downturn and credit squeeze, we have done better than many other countries.”

Asked whether the apprehension on sanctity of PSC and the ongoing dispute could also be the reason, he said, “the fight is here (domestic) not at other places… As regards sanctity of PSC, there was some misinformation, we have clarified that there is no proposal to nationalise gas finds. Also, our PSC has remained broadly the same from the beginning of the NELP rounds; there was some touching up in NELP-VII, but no changes in NELP-VIII.”

“Evaluation of the bids received under NELP-VIII and CBM-IV will be undertaken by the Government and the blocks are expected to be awarded within three months. The entire process, including signing of contracts, is expected to be completed in four months,” Mr Pandey said.

The Director-General of Hydrocarbons, Mr V. K. Sibal, said, “This legal challenge, misinformation among investors and economic downturn have impacted the bids. We have one of the best production sharing contracts in the world.”

Asked why NELP-VIII saw aggressive bidding by the PSUs while private and global players were not very enthusiastic, Mr Sibal said, “PSUs had to defend their market. Besides, they would have got high acreage cheap.”

More Stories on : Petroleum | Petroleum | Oil & Natural Gas Corporation Ltd

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