Page 142 - CW E-Magazine (29-4-2025)

Hydrocarbons

EASE OF DOING BUSINESS

India attracted $36-bn investment, 177 discoveries

in pre-2014 oil, gas blocks: Oil ministry report

India attracted over $36-bn invest- Despite its successes, NELP rounds Under RSCs, the contractor and
ment from nine NELP bid rounds held had its challenges, it said. “One of the government share revenue from the sale
before 2014, and has so far yielded 177 major issues was the delays in obtain- of hydrocarbons at pre-agreed percent-
oil & gas discoveries, according to a ing clearances, including environmen- ages, regardless of the costs incurred
report commissioned by the oil ministry. tal and regulatory approvals, which during exploration and production.
Under the New Exploration Licensing often resulted in signifi cant project The RSC regime was implemented in a
Policy (NELP), blocks were awarded delays. Additionally, disputes over cost series of eight bidding rounds, starting
to bidders promising maximum explo- recovery under the PSC regime led to with OALP-I round in 2018 and con-
ration, allowing them to recover invest- disagreements between contractors cluding with OALP-VIII in 2022, the
ments from oil and gas they discover and and the government, with both parties report said.
produce before sharing profi ts with the interpreting the contracts differently,”
government. In 2016, this was replaced it said. Recently, the government signed
by a revenue-sharing model, where contracts for the 28 blocks offered in
blocks go to fi rms offering the highest Recognising the need to improve OALP-IX round and a 10th round is
share of output to the government. the ease of doing business in the sector, under offer currently.
the government introduced a series of
The 254 blocks awarded in nine bid policy reforms and incentives aimed at The JWG, headed by Mr. Praveen
rounds of NELP between 1999 and 2010 addressing these ineffi ciencies. Khanooja, Additional Secretary, Minis-
attracted $17.6-bn investment in explo- try of Petroleum and Natural Gas, made
ration that led to 67 oil discoveries and In 2016, the Hydrocarbon Explora- recommendations for resolutions of
110 gas fi nds, and another $18.64-bn in tion and Licensing Policy (HELP) was issues ranging from delivery points of
development of some of those disco- introduced to address the challenges hydrocarbon discovered, grant of extra
veries. The 144 blocks awarded in eight faced under NELP and create a more days for delays in government related
big rounds of Open Acreage Licensing investor-oriented regime. HELP re- approvals, reduction in contract area
Policy (OALP) from 2018 to 2022 saw placed the production sharing contract and work programme due to denial or
$1.37-bn investment in exploration, (PSC) model with a Revenue Sharing delay in statutory clearances for explora-
leading to 6 oil discoveries and four gas Contract (RSC) model, simplifi ed the tory activities, fi eld development plan
fi nds, the report revealed. licensing framework, and introduced approvals, grant of extension of explo-
greater fl exibility in exploration and ration/development period and transfer
Reliance Industries Ltd. (RIL) production activities. of participating interest in blocks.
and its partner BP Plc’s eastern off- AGEING FIELDS
shore KG-D6 block, which produces a
third of entire natural gas produced in India’s oil & gas production fall in 2024-25
the country, as well as the showpiece India’s production of crude oil and previous growth was driven by output
KG-DWN-98/2 (KG-D5) block of natural gas declined in 2024-25 as out- from Reliance Industries’ new fi elds
state-owned Oil and Natural Gas Cor- put from mature fi elds continued to in the KG Basin. However, a decline
poration (ONGC) were awarded in fall. Crude oil output dropped 2.5% has now set in at Reliance’s KG-D6
NELP rounds. The interim report of the year-on-year to 26.5-million metric block, impacting national gas output.
Joint Working Group constituted by the tonnes (mmt) in 2024-25. Domestic Production in 2024-25 is only about
ministry on issues related to ‘Ease of crude production has been falling every 7% higher than it was a decade ago.
Doing Business in the Indian Upstream year for a decade, down 26% from The government is hopeful that the new
Sector’ said NELP helped increase area 35.9-mmt in 2014-15. Natural gas pro- oilfi eld regulatory law will help attract
under exploration and attract private duction declined by 1% to 36.1-billion foreign investors to India’s explora-
and foreign investment into India’s cubic metres (bcm) in 2024-25, after tion sector, potentially leading to new
exploration and production (E&P) sector. rising for three consecutive years. The discoveries.

142 Chemical Weekly April 29, 2025

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