 "An offshore oil platform at the Bouri Oil Field off the coast of Libya")
Fearing poor response, the government is likely to extend by at least one month the last date of bidding for the auction of 46 small oil and gas fields that were "given up" by state-owned ONGC and Oil India.
Bidding for the auction, the first in over four years, is to close on October 31.
There are apprehensions about the response after prospective bidders complained about the quality and amount of data being made available on the fields that have been put on offer, sources privy to the development said.
For bidders to make decisions, more data, particularly about the size of reserves, is required and making that available would require extending the deadline, they said.
Also, some prospective bidders have raised concerns about the size of the blocks or fields on offer. They say 10 square kilometer offering, one-tenth of the smallest block ever offered in the previous bid rounds, was too small. Sources said the bidders feel the block area has to be larger to give them room for probing for oil and gas reserves.
After holding roadshows in India and abroad, the Oil Ministry's technical arm, the DGH will on October 19 hold an "outreach" even on the Discovered Small Fields Bid Round 2016 in the national capital.
A 'Bidder Facilitation Workshop' is planned at the event to "resolve queries of the bidders", they said adding the extension of the bid deadline may be announced there.
The auction, which was announced on May 25, is to be conducted on simpler contractual terms together with pricing and marketing freedom.
India liberalised its exploration and production regime almost two decades ago when in the early 1990s, it auctioned about 28 fields to private and public investors.
In the late 1990s, it further liberalised its E&P sector with the introduction of New Exploration Licensing Regime (NELP) regime that allowed 100 per cent FDI and offered a level playing field to private and national oil companies.
NELP was based on Production Sharing Contract (PSC) that meant sharing of revenues with government post recovery of cost by contractor. This regime was marred by disputes over cost recovery and regulatory inflexibility.
Now the bid round is being held under a new regime that will offer discovered fields to those who offering the maximum share of oil and gas to the government.
The fields on offer hold an estimated 625 million barrels of in-place oil and gas reserves.
Sources said the 46 fields that are offered are actually 67 small and marginal discoveries that have been clubbed.
Oil and Natural Gas Corp (ONGC) and Oil India Ltd (OIL) "surrendered" these as they could not develop them because of huge overhead cost and uneconomic size.
Last exploration licensing round concluded in March 2012. That was the Ninth round of bidding under NELP. A total of 256 blocks were awarded in the nine rounds of NELP.
In the new round, as many as 67 idle discoveries of state-owned ONGC and OIL have been clubbed into 46 fields for offer in the international bidding round. Of these, 28 discoveries are in Mumbai offshore and another 14 are in the prolific Krishna Godavari basin.
As many as 10 discoveries are in the Assam shelf.
The discoveries were given up as late as 2012-13. These in-place reserves are estimated to have about 88 million tonnes of oil and oil equivalent gas.
The biggest discovery among the lot is the D-18 in Mumbai Offshore that alone holds 14.78 million tonnes of in-place oil reserves.
Among the gas discoveries, the largest is ONGC's B-9 find in the offshore Kutch basin that has an in-place reserve of 14.67 bcm.
Sources said the auction will be done on a new revenue sharing model where bidders will be asked to quote the revenue they will share with the government at low and high end of price and production band.
The new revenue sharing regime will replace the controversial PSC model where oil and gas blocks are awarded to those firms which show they will do maximum work on a block.
The PSC regime allowed all their investments to be recovered from sale of oil and gas before profits are shared with the government. This model was criticised by CAG which said it encouraged companies to keep raising cost so as to postpone higher share of profits to the government.
Also, single licence for exploration and exploitation of conventional and non-conventional hydrocarbons will be issued and operators will have freedom to sell oil and gas on arms on arms length market price, they said, adding that there would be no cess on crude oil.
