State oil companies corner one-third of small fields in first auction

State oil companies corner one-third of small fields in first auction

State-owned oil firms IOC, BPCL and HPCL have cornered a third of the 31 small discovered oil and gas fields awarded in the first auction in more than six years.

Touted as an auction round that would replicate the shale gas revolution of the US, half of the fields went to new and lesser known entrants like engineering company Megha Engineering & Infrastructure, KEI-RSOS Petroleum, Enquest Drilling and Nippon Power.

The Cabinet Committee on Economic Affairs yesterday approved award of 31 fields out of 34 that received bids in the auction that closed on November 21. These fields, which hold in place reserves of 62 million tonnes of oil and oil equivalent gas, can cumulatively produce a peak of around 15,000 barrels of oil per day and 2 million standard cubic meters per day of gas, the Directorate General of Hydrocarbons (DGH) said in a statement.

The peak oil and gas output envisaged is about two per cent of India’s current oil and gas production.

“It has been estimated that the indicative gross revenue over economic life would be approximately Rs 46,400 crore of which royalty collection and government’s revenue share is expected to be around Rs 5,000 crore and Rs 9,300 crore, respectively,” it said.

Development of these small oil and gas fields is crucial in achieving Prime Minister Narendra Modi’s target of reducing oil imports by 10 per cent by 2022.

Akhil Teja Natural Resources Ltd, which was incorporated just three days prior to close of the bidding, had bid for the most number of 17 fields. But it drew a blank with the CCEA not even accepting its solo bid for three onland blocks, according to analysis of list of awardees approved by CCEA.

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Bharat PetroResources Ltd, a unit of Bharat Petroleum Corp Ltd (BPCL), won the most number of 5 fields. It had put in a bid for eight.
Corp (IOC) bagged three fields, the same number as new entrant PFH Oil and Gas Pvt Ltd got.  Read More…

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