BackCentre to auction unmonetized oil, gas fields of ONGC and OIL
The move is aimed at boosting domestic output and securing India’s energy needsUnder the third round, 32 contract areas comprising 75 discoveries are on offer. The last date of bid submission is 31 August
PremiumThe government has decided to auction unmonetized oil and gas fields of state-run Oil and Natural Gas Corp. (ONGC) and Oil India Ltd (OIL) to raise hydrocarbon production and improve energy security.
Speaking at the launch of the third bid round of discovered small fields (DSF), petroleum and natural gas minister Dharmendra Pradhan on Thursday said, “There will be no DSF next time. Next time, it will be a ‘major’ round." The National Democratic Alliance government introduced the DSF policy by leveraging the small fields of ONGC and OIL.
Pradhan said that companies that have been awarded hydrocarbon blocks can’t indefinitely sit on discovered resources, and asked the director general of hydrocarbons and oil ministry officials “to devise innovative ways for early resource monetization, including expediting production timelines under DSF I & II". These fields were awarded to ONGC and OIL on a nomination basis. The move is aimed at boosting domestic output and securing India’s energy needs. The plan aims to leverage the expertise of private and foreign firms to grow domestic production and help meet India’s energy demand. “Resources don’t belong to a company. They belong to the nation and the government. They cannot lie with a company indefinitely," Pradhan said.
India, the world’s third largest oil importer, is expected to be a growth driver of global energy demand, as articulated by Igor Sechin, chief executive officer of Rosneft Oil Co. recently at the 24th St Petersburg International Economic Forum.
“Pradhan urged that the work on DSF should be done at exponential speed and on a mission mode to monetize our natural resources for greater public welfare," the petroleum ministry said in a statement.
Under the third round, 32 contract areas comprising 75 discoveries are on offer. These blocks are spread over 13,000 sq. km and are expected to have 230 million tonnes of hydrocarbon in place. The last date of bid submission is 31 August. In the first and second rounds, 30 and 24 revenue sharing contracts were inked respectively. In March 2015, Prime Minister Narendra Modi set a target of reducing import dependence on crude oil by 10 percentage points to 67% by 2022. With domestic production unable to cater to the rising demand, India will depend on imports in the foreseeable future.
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