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New Delhi: Faced with a global shortage of offshore drilling rigs, the Government may this month decide on giving a three-year drilling holiday or moratorium to firms such as state-owned Oil and Natural Gas Corp and Reliance Industries.
"An Empowered Committee of Secretaries (ECS) last week cleared the proposal and it is likely to be put before the Cabinet now," a Petroleum Ministry official said.
Companies such as ONGC and Reliance have not been able to meet their work commitments for the blocks they had won under the New Exploration Licensing Policy (NELP) rounds due to a crunch in availability of deep-sea drilling rigs.
The official said oil ministry is moving a note for the consideration of Cabinet Committee on Economic Affairs (CCEA) for giving a drilling holiday from January 1, 2008, to December 31, 2010, for 33 blocks awarded in the fifth round of NELP.
Of the blocks, where the drilling moratorium would apply, 15 are with ONGC, 17 with Reliance and one with ENI of Italy.
Globally, oil and gas explorers are faced with huge shortage of drilling rigs as countries stepped up oil and gas hunt in the wake of the surge in crude oil prices. Day-hire charges for a deep-sea drill rig have shot up 250 per cent during the past two years.
But for the drilling holiday, the companies faced huge penalties for not fulfilling their work commitments that included drilling of a certain number of wells.
The official said, though a drilling holiday was earlier being considered even for NELP-VI, the same is not being included in the Cabinet note as the first phase of exploration for these areas is up to 2010.
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