Lack of foreign interest forces Aiyar to mull new exploration policy

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New Delhi, July 7: The government has decided to take a re-look at its present oil and gas exploration policy. Offering blocks under various rounds of the New Exploration and Licensing Policy (Nelp) has not attracted sufficient foreign capital. Moreover, the policy has been in existence for eight years and petroleum minister Mani Shankar Aiyar wants to fine tune it to attract foreign companies in much bigger numbers.

Speaking to reporters at a press conference, Mr Aiyar said he was not happy with the news flow from the director general of hydrocarbons that not many foreign companies will be awarded blocks under the fifth round of the New Exploration and Licensing Policy (Nelp-5).

“Despite an excellent reponse from foreign oil and gas companies in the fifth round of Nelp, one hears that domestic companies are outbidding most of the foreign players. The entire effort of conducting roadshows abroad to convince international oil majors to come and invest in India’s upstream sector seems more of a wasteful exercise,” the minister said.

The whole idea to get foreign companies, he said, was to get newer technologies and more capital in exploring oil and gas in India. “Should we therefore replace this policy with a new one? I have asked oil industry body — Petrofed to coordinate a joint exercise with private, international and domestic firms and suggest measures in this regard”, the minister said.

In addition, Mr Aiyar announced constitution of another group comprising Shell India country head Vikram Mehta and joint secretary, petroleum ministry, MS Srinivasan for conducting a study on how to get oil majors invest in India’s upstream and midstream sectors.