Lok Sabha Question No. 2737 (UNSTARRED), answered on 2018-03-12
Subject: Discovered Small Field Policy
Ministry: PETROLEUM AND NATURAL GAS
Asked by: J. JAYASINGH THIYAGARAJ NATTERJEE, VASANTHI M., PONNUSAMY VENUGOPAL, RAMACHANDRAN MULLAPPALLY, K. GOPAL, UDIT RAJ, OM BIRLA

## LOK SABHA UNSTARRED QUESTION NO. 2737 TO BE ANSWERED ON 12.03.2018

## Discovered Small Field Policy

2737.  SHRI J.J.T. NATTERJEE:

SHRIMATI VASANTHI M.:

DR. P. VENUGOPAL:

SHRI MULLAPPALLY RAMACHANDRAN:

DR. K. GOPAL:

DR. UDIT RAJ:

SHRI OM BIRLA:

## पेट्रोल ियम एवं प्राक ृ तिक गैस मंत्री

## Will the Minister of PETROLEUM AND NATURAL GAS be pleased to state:

- (a) whether the Government has approved addition of another 60 discovered small fields/unmonetised discoveries relinquished by ONGC and Oil India Limited to be auctioned later this year to various Indian/foreign companies under Discovered Small Fields (DSF) Policy Bid Round II in addition to the first round last year;
- (b) if so, the details thereof along with number of contracts signed so far under DSF Policy with various companies  and the revenue likely to be generated from these fields, company/field/State-wise;
- (c)  whether  the  Government has approved 69  marginal fields to  be offered under the DSF Policy and if so, the details thereof along with number of such blocks auctioned and revenue generated by the Government so far, company/field/Statewise including Rajasthan;
- (d)  whether  ONGC  Officers  Association  has  objected  to  sell  the  company's  oil  and  gas production  fields  and  if  so,  the  details  thereof  along  with  the  reaction  of  the  Government thereto;
- (e) whether the production at the western offshore Panna/Mukta fields that were privatised in the 1990s and production from other fields such as KG D6 was also falling but ONGC has done well with its ageing fields and if so, the details thereof; and
- (f) the aims, objectives and salient features of the Hydrocarbon Exploration Licensing Policy (HELP) and Open Acreage Licensing Policy?

## Answer

पेट्रोल ियम एवं प्राक ृ तिक गैस मंत्रािय में मंत्री ( श्री धमेंद्र प्रधान )

## MINISTER IN THE MINISTRY OF PETROLEUM & NATURAL GAS (SHRI DHARMENDRA PRADHAN)

- (a)  to  (d)  Many  of  the  discovered  oil  and  gas  fields  of  the  ONGC  and  OIL  could  not  be monetized for years due to various reasons such as isolated locations, small size, prohibitive development  costs,  technological  constraints  etc.  Government  brought  out  various  policies for early monetization of discoveries made by National Oil Companies to enhance domestic production. Government had earlier allowed private participation in the Pre-NELP discovered fields  round in 1992-1993. With a view to increase domestic production of oil and gas, in September,  2015  the  Discovered  Small  Field  Policy  was  notified  for  monetization  of  69 discovered small fields of ONGC and OIL, which had not been put into production. Under

the Policy 30 contract areas (43 fields) were awarded for development through International Competitive  Bidding  (ICB).  The  details  are  at  Annexure-I  National  oil  companies,  Indian private companies and foreign companies either alone or in joint venture were eligible to bid for  the  offered  small  fields.  It  has  also  been  decided  to  extend  the  Discovered  Small  Field Policy for future round of bidding. Therefore, 60 fields have been identified for award under DSF Bid Round-II in consultation with ONGC/OIL. These fields have 194.65 Million Tonnes of Oil Equivalent in place reserve of crude oil and natural gas.

(e)  The majority of crude oil and natural gas production in the country is from the ageing fields  operated  by  ONGC,  OIL  and  Private/Joint  venture  companies  which  are  on  natural decline  of  production.  The  production  potential  from  a  field  is  highly  dependent  on  the reservoir  characteristics  of  the  field  such  as  -  porosity,  permeability,  formation  pressure, size/location  of  field,  etc.  leading  to  variable  rate  of  production  from  different  oil  &  gas fields.  During the lifecycle of oil and gas production from a reservoir, initially production increases  for  a  certain  period  of  time,  then  it  reaches  to  plateau  production  for  couple  of years, and thereafter, natural decline of oil & gas production is observed.  In other words, the production potential of fields varies depending upon the reservoir characteristics of the oil & gas fields and  dynamic  in  nature. The  natural decline  of  production  is  a  common phenomenon in oil & gas production.

Till the year 2012, under various rounds of New Exploration Licensing Policy a total of 254 exploration blocks were awarded for carrying out exploration and production activities. In  addition  to  this,  28  Pre-NELP exploration fields and 28 discovered fields were awarded under various rounds of bidding, which also includes Panna-Mukta discovered fields.

In case of Panna-Mukta field, initial crude oil and natural gas production in 1994-95 was 0.136 MMT and 0.08 BCM respectively. The peak production for Panna-Mukta was attained in  2007-08  with  crude  oil  production  of  1.910  MMT  and  natural  gas  production  of  2.14 BCM. Thereafter natural decline of oil and gas production was observed.

In KG-DWN-98/3, initial crude oil and natural gas production in 2008-09 was 0.129 MMT and 0.08 BCM respectively.  The peak production for KG-D6 was in 2010-11 with crude oil production of 1.08 MMT and natural gas production of 20.40 BCM. Thereafter decline of oil and gas production was observed.

ONGC has arrested natural decline of crude oil and natural gas production with application of state-of-art technologies, optimization of facilities, regrouping of structures, hub development etc.

(f)  The  salient  features  of  new  Hydrocarbon  Exploration  &  Licensing  Policy  (HELP)  and Open Acreage Licensing Policy are as follows: -

-  Single License for conventional and unconventional Hydrocarbons.
-  An Open Acreage Licensing Policy.
-  Easy to administer Revenue Sharing Model
-  Marketing & pricing freedom for the Crude oil & Natural gas produced.
-  Zero royalty rates for deepwater and ultra-deepwater blocks for first seven years.
-  Equal weightage to work programme and fiscal share
-  No oil cess Custom duty exemption etc.

## Annexure-I

## To referred in reply of Lok Sabha Unstarred Question No. 2737

## Details of awarded 43 fields (30 Contract Areas) through international competitive bidding under Discovered Small Filed Bid Round-2016

|   S.n o | Location           | Contract Area Name (New)   | Company Name                                  | Status   | Field Name                   |   Expected Revenue net of Royalty (INR Crore) |
|---------|--------------------|----------------------------|-----------------------------------------------|----------|------------------------------|-----------------------------------------------|
|       1 | Assam              | AA/ONDSF/HILARA/2016       | Prize Petroleum Company Limited               | Awarded  | HILARA                       |                                          24.2 |
|       2 | Assam              | AA/ONDSF/LAXMIJAN/2016     | Megha engineering and infrastructures limited | Awarded  | LAXMIJAN, BIHUBAR            |                                        2320.1 |
|       3 | Assam              | AA/ONDSF/PATHARIA/2016     | Vijayasri bhaskar industries private limited  | Awarded  | PATHARIA                     |                                         224.2 |
|       4 | Assam              | AA/ONDSF/BARSILLA/2016     | Ramayna Ispat Private Limited                 | Awarded  | BARSILLA                     |                                        1976.8 |
|       4 | Assam              | AA/ONDSF/BARSILLA/2016     | BDN Enterprises Pvt Ltd                       | Awarded  | BARSILLA                     |                                        1976.8 |
|       4 | Assam              | AA/ONDSF/BARSILLA/2016     | Duggar Fiber Pvt Ltd                          | Awarded  | BARSILLA                     |                                        1976.8 |
|       4 | Assam              | AA/ONDSF/BARSILLA/2016     | Mahendra Infratech Pvt Ltd                    | Awarded  | BARSILLA                     |                                        1976.8 |
|       5 | Assam              | AA/ONDSF/CHARAIDEO/201 6   | OILMAX ENERGY PRIVATE LIMITED                 | Awarded  | CHARAIDEO                    |                                        1937.7 |
|       6 | Assam              | AA/ONDSF/DIPLING/2016      | Ramayna Ispat Private Limited                 | Awarded  | DIPLING, SAPEKHATI, SAROJINI |                                        6481   |
|       6 | Assam              | AA/ONDSF/DIPLING/2016      | BDN Enterprises Pvt Ltd                       | Awarded  | DIPLING, SAPEKHATI, SAROJINI |                                        6481   |
|       6 | Assam              | AA/ONDSF/DIPLING/2016      | Duggar Fiber Pvt Ltd                          | Awarded  | DIPLING, SAPEKHATI, SAROJINI |                                        6481   |
|       6 | Assam              | AA/ONDSF/DIPLING/2016      | Mahendra Infratech Pvt Ltd                    | Awarded  | DIPLING, SAPEKHATI, SAROJINI |                                        6481   |
|       7 | Assam              | AA/ONDSF/DUARMARA/201 6    | OILMAX ENERGY PRIVATE LIMITED                 | Awarded  | DUARMARA                     |                                          65.6 |
|       8 | Assam              | AA/ONDSF/JERAIPATHAR/2 016 | Indian Oil Corporation Ltd                    | Awarded  | JERAIPATHAR                  |                                          63.1 |
|       9 | Arunacha l Pradesh | AA/ONDSF/KHEREM/2016       | HINDUSTAN OIL EXPLORATION COMPANY LIMITED     | Awarded  | KHEREM                       |                                         633   |
|       9 | Arunacha l Pradesh | AA/ONDSF/KHEREM/2016       | Oil India Limited                             | Awarded  | KHEREM                       |                                         633   |
|       9 | Arunacha l Pradesh | AA/ONDSF/KHEREM/2016       | Prize Petroleum Company Limited               | Awarded  | KHEREM                       |                                         633   |
|      10 | Gujarat            | CB/ONDSF/ELAO/2016         | PFH OIL AND GAS PRIVATE LIMITED               | Awarded  | ELAO                         |                                          28.4 |
|      11 | Gujarat            | CB/ONDSF/SOUTH PATAN/2016  | South Asia Consultancy FZE                    | Awarded  | SOUTH PATAN                  |                                         257.6 |
|      12 | Gujarat            | CB/ONDSF/KHAMBEL/2016      | Megha engineering and infrastructures         | Awarded  | KHAMBEL                      |                                          41   |

|    |                 |                               | limited                                   |         |                       |        |
|----|-----------------|-------------------------------|-------------------------------------------|---------|-----------------------|--------|
| 13 |                 | CB/ONDSF/KAMBOI/2016          | NIPPON POWER LTD                          | Awarded | KAMBOI                |   76.1 |
| 14 |                 | CB/ONDSF/WEST BECHRAJI/2016   | NIPPON POWER LTD                          | Awarded | WEST BECHRAJI         |  433.2 |
| 15 | Tamil Nadu      | CY/ONDSF/NEDUVASAL/20 16      | GEM LABORATORIES PRIVATE LIMITED          | Awarded | NEDUVASAL             |  251.3 |
| 16 |                 | CY/ONDSF/KARAIKAL/2016        | Bharat PetroResources Limited             | Awarded | KARAIKAL              |   17.6 |
| 17 | Andhra          | KG/ONDSF/ACHANTA/2016         | PFH OIL AND GAS PRIVATE LIMITED           | Awarded | ACHANTA               |   24.6 |
| 18 |                 | KG/ONDSF/BHIMANAPALLI /2016   | PFH OIL AND GAS PRIVATE LIMITED           | Awarded | BHIMANAPALLI          |   17.9 |
| 19 | Pradesh         | KG/ONDSF/KORAVAKA/201 6       | KEI-RSOS Petroleum &Energy Pvt Ltd        | Awarded | KORAVAKA              |  121.3 |
| 20 |                 | KG/ONDSF/SANARUDRAVA RAM/2016 | Prize Petroleum Company Limited           | Awarded | SANARUDRAVA RAM       |   14.7 |
| 21 | Rajasthan       | RJ/ONDSF/BAKHRI TIBBA/2016    | Bharat PetroResources Limited             | Awarded | BAKHRI TIBBA          |   45.3 |
| 22 |                 | RJ/ONDSF/SADEWALA/2016        | Bharat PetroResources Limited             | Awarded | SADEWALA              |   32.8 |
| 23 | Madhya Pradesh  | VN/ONDSF/NOHTA/2016           | Indian Oil Corporation Ltd                | Awarded | NOHTA                 |  417.7 |
| 24 |                 | MB/OSDSF/B37/2016             | Sun Petrochemicals Pvt. Ltd.              | Awarded | B37,B-174,B- 183,B-51 | 4288.2 |
| 25 |                 | MB/OSDSF/B9/2016              | Adani Welspun Exploration Ltd.            | Awarded | B-9,B-7,BRC           | 5295.7 |
| 26 |                 | MB/OSDSF/B15/2016             | Bharat PetroResources Limited             | Awarded | B-15,B-15A            |  331.6 |
| 27 | Mumbai Offshore | MB/OSDSF/B127E/2016           | Bharat PetroResources Limited             | Awarded | B-127E,B-153          | 1335.9 |
| 28 |                 | MB/OSDSF/B80/2016             | HINDUSTAN OIL EXPLORATION COMPANY LIMITED | Awarded | B-80                  | 1334.4 |
| 28 |                 |                               | Adbhoot Estates Private Limited           | Awarded | B-80                  | 1334.4 |
| 29 | Kutch Offshore  | GK/OSDSF/KD/2016              | Indian Oil Corporation Ltd                | Awarded | KD                    | 1616.7 |
| 30 | KG- Offshore    | KG/OSDSF/GSKV1/2016           | KEI-RSOS Petroleum &Energy Pvt Ltd        | Awarded | GS-59, GS-KV-1        |  789.1 |