54 firms bid for coal bed methane blocks

The government today received 54 bids from domestic and international companies, including the UK's BP and Coal Gas of the US, for development of ten blocks of coal-bed methane.

The current round of bidding is the third such round for coal-bed methane (CBM).

Domestic bidders included companies that belong to both, the Mukesh Ambani and Anil Ambani groups.

Reliance Industries, Reliance Energy, Oil and Natural Gas Corporation, Indian Oil Corporation, Tata Power and Essar Oil were among the well-known domestic bidders. Indiabulls and Reliance Natural Resources also submitted bids.

Dinsha Patel, minister of state for petroleum, said CBM-III had attracted 54 bids, almost three-and-a-half-times the number of bids that came in for CBM-I.

The bidders' response indicated that the perception about natural gas potential in India had turned positive, said VK Sibal, director-general of hydrocarbons.

The ten blocks had reserves of 586 billion cubic meters, Sibal said. The bidding process had attracted Rs 9.50 crore, but the actual investment for CBM-III would be known only when the government completed the evaluation of bids by August 31, 2006.

The contract between the government and the successful bidders would be signed by October 2006.

Eight overseas companies and 18 Indian companies bid for blocks in CBM-III. Among leading overseas bidders were Arrow Energy of Australia, CDX Gas of the US and GeoPetrol of France.

The ten blocks are spread over West Bengal, Jharkhand, Chhattisgarh, Madhya Pradesh, Rajasthan and Andhra Pradesh.