Petroleum Minister Dharmendra Pradhan on Monday assured investors here that the government will "proactively facilitate" their working in the Indian oil and gas sector.
Continuing with road shows abroad to attract foreign investors in exploiting India’s discovered small oil and gas fields, Petroleum Minister Dharmendra Pradhan on Monday assured investors here that the government will “proactively facilitate” their working in the Indian oil and gas sector.
“Assured the investors that Govt will proactively facilitate their working Indian oil & gas sector,” Pradhan said in a tweet after addressing an interactive meet on the upcoming auction of India’s 67 hydrocarbon discovered small fields (DSF)
“India is growing at fastest rate and government is committed to open up the market,” he said in a separate tweet.
The minister earlier inaugurated the physical data room here of the Discovered Small Fields Bid Round.
An Indian Petroleum Ministry release earlier said that Pradhan will interact with officials of the UK Trade and Investment department on the ongoing hydrocarbon sector reforms in India and have one-to-one meeting with prospective bidders, representatives of commodity exchange market and regulators.
He is also slated to meet British Energy Minister Greg Clark and the Scottish Energy Minister in Aberdeen, the statement added.
India’s Petroleum Ministry along with the Directorate General of Hydrocarbon (DGH) has organised this series of interactive meet-cum-roadshows between September 9-14, earlier in Singapore and currently in Britain.
“During the meetings, Pradhan is expected to highlight the paradigm shift in the policy regime for the exploration and production sector in India and the improved investment environment for E&P (exploration and production) companies under the new Hydrocarbon Exploration Licensing Policy (HELP) which emphasises on improving the ease of doing business and operational autonomy to attract investment,” DGH had said in a statement.
At the event, Director General of Hydrocarbons Atanu Chakraborty elaborated on the changes made in the Indian oil and gas exploration regime.
“To ensure transparency, bidding process is made completely online,” DGH said in a tweet citing the presentation here by Chakraborty.
“DSF policy offers, No minimum work programme, Free pricing and marketing freedom,” DGH said in another tweet citing Chakraborty.
Road shows were earlier held in July in the US and Canada, for the auction of India’s discovered small fields.
Bidding is open between July 15 and October 31.
The previous exploration licensing round ended in March 2012.
The auction will be under the new Hydrocarbon Exploration and Licensing Policy (HELP) approved in March, based on a revenue-sharing model as opposed to cost-and-output-based norms earlier.
The new model will replace the controversial production sharing contracts — by which oil and gas blocks are awarded to firms which show they will do maximum work on a block — that has governed the bidding under the earlier nine NELP rounds.
Under the Discovered Small Field Policy, the government is offering for bids 67 discovered small fields in 46 contract areas spread over nine sedimentary basins on land and in shallow and deep water areas.
The offered fields hold 625 million barrels of oil and gas reserves.
Of the 46 small fields, 26 are on land, 18 offshore in shallow water and two in deep water.
While 28 discoveries are in Mumbai offshore, 14 others are in the east coast’s Krishna-Godavari basin.
Eventual operators will be issued a single licence for exploration of conventional and non-conventional hydrocarbons and will have the freedom to sell oil and gas at “arms length” market prices. There would be no cess on crude oil.
The production sharing contracts regime, which allows operators to recover all investments made from sale of oil and gas before profits are shared with the government, was criticised by India’s official auditor, who said it encouraged companies to keep inflating costs — “gold plating” — so as to postpone giving a higher share of profits.
The change in model is designed to help keep the government share in cases of windfall from both a steep rise in prices as well as a quantum jump in production.