10th oil, gas bidding round may offer 'no-go' areas: Oil ministry official

Areas likely to be offered in next round will include once which till now were in so-called 'no-go' areas where exploration and production of oil and gas were prohibited because of strategic reasons

India is likely to offer areas classified as 'no-go' areas in the tenth round of bidding for exploring and producing oil and gas in early 2025, a top oil ministry official said on Thursday.

Bids for 28 oil and gas blocks offered in the ninth Open Acreage Licensing Policy (OALP) round closes on September 21 and the 10th round is in works, the official, speaking on condition of anonymity, told reporters here.

OALP-X round will happen after the Parliament approves in the ensuing winter session amendments to the Oilfields (Regulation and Development) Act (ORDA) of 1948 to expand definition of mineral oils to include any naturally occurring hydrocarbon, coal-bed methane and shale gas/oil. The amendment also replaces mining lease with petroleum lease and decriminalises certain offences.

"We hope that the amendments will be approved in the winter session of Parliament (likely in November/December). The changes are expected to bring confidence for the potential bidders for OALP X exploration acreages being planned in early 2025," he said.

Areas likely to be offered in the next round will include once which till now were in so-called 'no-go' areas where exploration and production of oil and gas were prohibited because of strategic reasons.

Following an elaborate exercise to limit the 'no-go' areas to only ones that are critically important for missions such as missile testing in the Bay of Bengal, a large acreage has been released for exploration purposes. This will be offered in the OALP-X round, the official said.

The ninth bidding round was announced on January 3 with February 29 as the original bid submission deadline. That deadline has been extended multiple times, with the current one ending on September 21.

The official said the bid opening, evaluation and approval of the Cabinet is likely to take a couple of months and the signing of contracts for OALP-IX blocks is likely only in early 2025. By this time the amendments to the ORDA are likely to be passed and the liberalised terms may be extended to the OALP-IX blocks as well.

"We have stated that we will try and factor in all inputs of ORDA amendments in OALP-IX round," he said.

The OALP rounds are essential for India to raise domestic crude oil and natural gas production. Currently, India imports more than 85 per cent of its crude oil needs and roughly half of its gas requirement.

Of the 28 blocks offered in OALP-IX, nine are onshore blocks, eight shallow-water blocks and 11 ultra-deepwater blocks across eight sedimentary basins, with an area of 136,596.45 square kilometers. The Directorate General of Hydrocarbons (DHG) "carved out" five of these blocks, while the remaining 23 blocks are based on expressions of interest received from companies during April 2022-March 2023.

In the previous eight OALP rounds, 144 exploration and production blocks comprising a total area of 242,055 sq km have been awarded. In the last round, state-owned ONGC won seven blocks while a private-sector consortium of Reliance Industries and BP, Oil India and private-sector Sun Petrochemicals received one block each.

The government introduced the OALP in 2017 to attract oil and gas firms to develop India's upstream sector. The OALP guarantees marketing and pricing freedom with a revenue-sharing model, apart from offering reduced royalty rates.