India on Monday offered for bidding seven new areas for prospecting of oil and natural gas on revamped exploration terms that look to expedite cut in import dependence by raising domestic output.
Five blocks offered are in little-explored Vindhyan sedimentary basin, while one block is in Bengal Purnea basin. The remaining block is the proven basin of Rajasthan, according to a press statement by the Directorate General of Hydrocarbons (DGH).
In all, 18,509.69 square kilometre of area for exploration of oil and gas has been offered in the fourth bid round of Open Acreage Licensing Policy (OALP).
The government has under the previous three OALP rounds awarded 87 blocks covering an area of 1.18 lakh sq km.
OALP-IV is the first round being held on revamped terms approved in February 2019.
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DGH said, unlike previous rounds where blocks were awarded to companies offering a maximum share of oil and gas to the government, blocks in little or unexplored Category-II and III basins will be awarded to companies offering to do maximum exploration programme.
While Vindhyan is Category-II basin block, Bengal Purnea is Category-III area where no exploration has happened so far.
The revamped policy also provides for "shorter exploration period, concessional royalty rates to expedite oil and gas production and introduction of alternate dispute resolution mechanism," the statement said.
Under OALP, companies are allowed to carve out areas they want to explore oil and gas in. Companies can put in an expression of interest (EoI) for any area throughout the year but such interests are accumulated thrice in a year. The areas sought are then put on auction.
DGH said the last date for bidding for OALP-IV blocks is October 31.
"It is expected that OALP Round IV would generate immediate exploration work commitment of around USD 200-250 million," it said.
The 5th cycle of submitting EoIs is currently going on till November 30, 2019, and would be followed by the 6th cycle from December 1, 2019, till March 31, 2020, DGH said.
The Vindhyan basin covers areas under the Son valley, Bundelkhand and Rajasthan, while the Bengal Purnea basin is in West Bengal and extends into the offshore region of the Bay of Bengal.
Under the revamped policy, Category-1 basin areas, where production has already been established, are bid out on a combination of exploration work programme and revenue share to the government in 70:30 ratio.
The seven category-I explored basins in India are Cambay, Mumbai Offshore, Rajasthan, Krishna Godavari, Cauvery, Assam Shelf, and Assam-Arakan Fold Belt.
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