India to auction oil and gas blocks this fiscal, says Dharmendra Pradhan

Hyderabad: The next round of auction of oil and gas blocks under the New Exploration Licensing Policy (NELP) will be held by the end of 2015-16 fiscal, Petroleum and Natural Gas Minister Dharmendra Pradhan said today. The minister also said that the government is mulling to introduce “open acreage” system and also plans to change the formula for production sharing agreement. [caption id=“attachment_2109713” align=“alignleft” width=“380”]  Oil Minister Dharmendra Pradhan. Image courtesy PIB[/caption] “In this financial year, only 10th round of auction will be held. We are talking to stakeholders. We are talking to international experts… we are observing the different models of the world (for the NELP-X round),” Pradhan told reporters in Hyderabad. NELP-IX auction was conducted in 2012. He said the government is contemplating to make three major changes in the auctioning system that includes abolishing block auctioning by bringing “open acreage” system in which the bidding and award of acreages will be a continuous, demand-based process. “In NELP-X, there will be three major thrust areas. There are some issues with the current production sharing model. CAG has also made some observations. Looking back into our past experience, we are talking to different stakeholders on how it should be. “Number two is the general acreage policy. Previously there was a block system. Now looking into the new channels acreage system will be open so that anybody can bid for any acreage, according to their own requirement,” Pradhan said. The government is also planning to allow the bidder or contractor to extract any unconventional hydrocarbons (other than oil and gas) if found, he said. The minister said investors are “happy” with the current gas pricing formula which is reviewed every six months. He said the state-owned oil companies are currently taking up various projects including a product pipeline from Paradeep to Hyderabad and a gas pipeline from Mumbai to Hyderabad to cater to the needs of Telangana and other southern states’ requirements. According to him the projects, for creating petroleum infrastructure involving various states, would cost nearly Rs 1,300 crore for Telangana sector alone. Pradhan met Andhra Pradesh Chief Minister N Chandrababu Naidu on Thursday. PTI