The Directorate General of Hydrocarbons (DGH), established in 1993, is the most important technical watchdog in the oil & gas sector. This arm of the petroleum ministry is responsible for verifying commerciality of hydrocarbon finds, as well as budgets and work programmes under production sharing contracts (PSC). However, in the past few years, DGH has been handling arbitration between the government and explorers such as RIL. The organisation faced a severe talent crunch and was unable to deliver on goals. BN Talukdar—formerly the director of Oil India, who took charge as the director general of DGH in February 2014—brought several changes by introducing real-time monitoring of oil & gas blocks, taking up geological surveys, setting up a data centre for rolling out open acreage model and clearing budgets before time, among others. Talukdar speaks about the challenges he faced and how he managed to bring reforms, a day before his superannuation, in an interview with Siddhartha P Saikia. Excerpts:
What was the biggest challenge when you took charge at DGH?
DGH was not doing the job it was meant to do. It was formed with the mandate to promote sound management of Indian hydrocarbon resources as per Dasgupta and Kaul Committees’ reports. However, officers were busy fire-fighting to manage PSC and defending arbitration and legal cases.
What did you do to change things?
While I continued with the aforementioned activities, I facilitated and strengthened the technical team of DGH. Almost all technical software was lying unused because of the non-availability of licence for years and for want of manpower to work on technical issues. I reinstated the software and formed a dedicated technical team. Further, there was no Management Information System to check day-to-day status of blocks/fields etc, which I initiated. We hugely reduced the number of pending cases with DGH, which were left unattended for a long time.
DGH plays a crucial role—it is a part of management committees. But the budget and work programmes were not cleared on time, leading to uncertainties for explorers…
Yes, work programmes and budget for a particular year used to be approved by the management committee only during the year and at times towards the end of the year, leaving operators in uncertainty. After I took over, the entire process has been streamlined. For instance, for 2015-16, all management committee formalities have been completed before March 31, 2015.
Is it true that the regulator does not have adequate manpower?
It is true. For many years, DGH had an acute shortage of manpower, affecting operations. Now we have managed to strengthen it by adding 50 additional officers from ONGC and OIL.
What is the status on National Data Repository (NDR), without which open acreage model to give out oil & gas blocks would not take off?
The NDR project—hanging for over a decade—has been implemented in the DGH premises and the mechanical completion of the same is over. Currently, data loading is going on. The entire country’s exploration and production data will be loaded on NDR so that any interested party from anywhere in the world can have access to data and show interest to invest in India.
Global explorers shy away from India, citing absence of adequate geological data, which leads to unsuccessful exploration. Do you agree?
For about two decades, no fresh assessment was done to gauge the hydrocarbon potential of all the 26 basins of India. After I took over, the same is being carried out through ONGC. Fresh scrutiny has been done to know the extent of unappraised areas of the country, which has been found to be around 50%. Steps have been taken with the approval of the ministry to cover all onshore areas by a 2D seismic survey within an upper limit of five years. These tasks have been entrusted to ONGC and OIL. To cover offshore areas, another policy has been made under the ‘multi-client non-exclusive’ survey, through which parties from across the globe can come and shoot seismic data at their cost, and sell to potential investors. They have to submit a licence fee, and a dataset to the government free of cost. Parties are starting operations immediately after the monsoon. This action has been taken after a lapse of one-and-a-half decade.
India lacks data on gas hydrates…
The second expedition of gas hydrates in the Indian offshore region has been started. A Japanese drill ship is already collecting gas hydrate samples in KG deepwaters in the presence of officials from DGH and ONGC.
The government is planning to bid out marginal fields. Are you prepared for it?
The Marginal Field Exploitation Policy is in advanced stage of approval. DGH has almost completed preparation of data dockets for the fields.
Do you think the PSC is updated?
PSCs are in vogue for two decades, but some key technical issues were not addressed which are required for E&P operations. Two major issues are: Good International Petroleum Industry Practices and Site Restoration Policy. Both these policies are being formulated with the help of a Standing Committee consisting of members from industry and the government.