ONGC, OIL big winners of OALP-VII bid; govt offers 10 block in OALP-VIII

State-owned ONGC, OIL and GAIL walked away with most of the eight blocks offered for exploration and production of oil and gas in the OALP 7th bid round even as the government launched the next round

State-owned ONGC, OIL and GAIL walked away with most of the eight blocks offered for exploration and production of oil and gas in the OALP 7th bid round even as the government launched the next bidding round, expecting USD 600-700 million investment in the 10 areas on offer.

Oil and Natural Gas Corporation (ONGC) won three blocks in the OALP-VII round while Oil India Ltd (OIL) won two, according to information posted by the DGH.

GAIL walked away with one block in Rajasthan while Sun Petrochemicals Pvt Ltd won the remaining two blocks.

Separately, the oil ministry said a new policy for finding and producing oil and gas, called the Hydrocarbon Exploration and Licensing Policy (HELP), was promulgated on March 30, 2016.

Since then, seven bid rounds of the Open Acreage Licensing Programme (OALP) have been concluded and 134 exploration and production blocks awarded. These blocks cover 2,07,691 square kilometers of area across 19 sedimentary basins.

"In continuation of its zeal to accelerate E&P activities, the government has now launched the OALP Bid Round-VIII, offering 10 blocks, for international competitive bidding," the ministry said in a statement.

The bids are due by September 6.

"Successful award of Round-VIII Blocks would add a further 36,316 sq km of exploration acreage and cumulative exploration acreage under OALP regime will be increased to 2,44,007 sq km," it said.

The 10 blocks under the present bid round are spread across nine sedimentary basins and include two on-land blocks, four shallow water blocks, two deep water blocks and a similar number of ultra-deep water blocks.

"It is expected that OALP Round VIII would generate immediate exploration work commitment of around USD 600-700 million," the statement said.

HELP provides for a revenue-sharing contract model, where the bidder offering the highest share of oil and gas to the government is awarded the block. It comes with attractive and liberal terms like reduced royalty rates, no oil cess, no revenue share bidding for blocks in Category-II and III Basins, marketing and pricing freedom, round-the-year bidding, freedom to investors for carving out blocks of their interest, a single license to cover both conventional and unconventional hydrocarbon resources, exploration permission during the entire contract period, and an easy, transparent and swift bidding and awarding process.