Lok Sabha Question No. 4695 (UNSTARRED), answered on 2022-03-31
Subject: Licensing of Hydrocarbon Sector
Ministry: PETROLEUM AND NATURAL GAS
Asked by: Lavu Sri Krishna Devarayalu

## LOK SABHA

## UNSTARRED QUESTION NO. 4695 TO BE ANSWERED ON 31 st  MARCH, 2022 Licensing of Hydrocarbon Sector

## 4695.  SHRI LAVU SRI KRISHNA DEVARAYALU:

## पेोलयम और ाक ृ तक गैस मंी

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

- (a) whether the Government has evaluated the savings reaped by the exchequer or PSUs under the new Hydrocarbon Exploration and Licensing Policy (HELP) versus the  earlier  New  Exploration  Licensing  Policy  (NELP)  for  licensing  of  different hydrocarbons;
- (b) if so, the details thereof;
- (c) the details of new exploration activities undertaken for unconventional hydrocarbon resources during the last five years;
- (d)  whether  it  is  true  that  the  bids  under  the  seventh  round  of  Open  Acreage Licencing Programme (OALP) has seen low bids and if so, the details thereof;
- (e) the details of the latest seventh round and previous rounds of biddings; and
- (f) whether the Government has taken any steps to increase private participation in the bids invited under OALP and if so the details thereof ?

## ANSWER

## पेोलयम और ाक ृ तक गैस मंालय म राय मंी ( ी रामेवर तेल )

## MINISTER OF STATE IN THE MINISTRY OF PETROLEUM & NATURAL GAS (SHRI RAMESWAR TELI)

(a) & (b): Government notified Hydrocarbon Exploration and Licensing Policy (HELP) on  30 th March  2016,  wherein the contractual regime  changed to  Revenue Sharing Contract  (RSC)  from  Production  Sharing  Contract  (PSC),  prevalent  under  New Exploration Licensing Policy (NELP). The primary objective of the HELP is ease of doing business and operational freedom to Operators, so that the existing Hydrocarbon  Resources  are  explored  more  effectively,  leading  to  a  reduction  in import  dependence and consequently savings. As commercial production from the blocks  awarded  under  HELP  has  not  yet  started,  savings/  revenue  cannot  be assessed.

(c):  HELP regime accords a uniform license to investors to explore and extract all hydrocarbon  resources  -  conventional  and  unconventional  including  Coal  Bed Methane (CBM), Shale Gas/Oil, Tight Gas, Gas Hydrates etc. Various  exploration activities  have  been  undertaken  for  unconventional  hydrocarbons  in  the  last  five years which interalia includes the following:

- (i)  Offer of fifteen CBM Blocks under HELP through Special CBM bid round 2021;
- (ii)  Drilling  of  thirteen  wells  by  Oil  and  Natural  Gas  Corporation  (ONGC)  in  High Pressure (HP) - High Temperature (HT) area. Out of these, two wells drilled in KG Basin were notified as discovery wells;

(iii) Drilling of five exclusive shale gas wells by ONGC in Cambay Basin and Krishna Godavari (KG) Basin.

(d) & (e):  Eight blocks were offered under OALP bid Round- VII covering an area of 15766 sq. km.  A total  of  ten  bids  have  been  received  for  these  blocks  from  four Companies.  The details of the latest seventh round and previous rounds of biddings under OALP are as under:

| OALP Bid Round   | Number of Blocks offered                  | Number of Bids received                   | Number of Blocks awarded                  | Exploration Acreage offered                                                    |
|------------------|-------------------------------------------|-------------------------------------------|-------------------------------------------|--------------------------------------------------------------------------------|
| I                | 55                                        | 110                                       | 55                                        | 59282 sq. km.                                                                  |
| II               | 14                                        | 33                                        | 14                                        | 29233 sq. km.                                                                  |
| III              | 23                                        | 42                                        | 18                                        | 31722 sq. km.                                                                  |
| IV               | 7                                         | 7                                         | 7                                         | 18511 sq km                                                                    |
| V                | 11                                        | 12                                        | 11                                        | 19789 sq. km.                                                                  |
| VI               | 21                                        | 24                                        | Yet to be awarded                         | 35346 sq. km.                                                                  |
| VII              | 8                                         | 10                                        | Bid evaluation is in progress             | 15766 sq. km.                                                                  |
| Total            | 105 awarded (29 under award & evaluation) | 105 awarded (29 under award & evaluation) | 105 awarded (29 under award & evaluation) | 156580 sq. km. awarded (51112 sq. km. area under award and evaluation process) |

(f) :   In addition to the HELP policy, Government has taken various steps to increase Private  participation  in  the  bids  invited  under  OALP,  which  interalia  include  the following:

1.  The  potential  investors  have  freedom  to  carve  out  the  blocks  as  per  own choice  and  submit  the  proposal  as  Expression  of  Interest  (EoI).  To  provide more opportunities,  EoI  submission  cycle  has  been  increased  from  twice  to thrice in a year.
2.  Transparent bidding model conducted on e-bidding platform.
3.  For blocks in Category II & III Basins, where prospectivity is low, the areas are awarded  exclusively  based  on  Work  Program  which  bidder  commits  to undertake  without  any  Revenue  Share  to  Government.    Revenue  is  to  be
4. shared with Government in case of windfall gain only when revenue exceeds USD 2.5 billion.
4.  Much  more  investor  friendly  regime  under  HELP  for  participation  of  private players  in  terms  of  Ease  of  Doing  Business.  Some  of  the  salient  features interalia include the following:
- a.  More freedom in operational matters, reducing approvals of Government/Directorate General of Hydrocarbons/Management Committee
- b.  Continuous exploration permitted throughout contract period
- c.  Extension of various timelines are now automatic on payment of fee
- d.  Simplified  contract  management  wherein  most  of  the  data  can  be submitted in standardized formats on self -certification basis.
- e.  Electronic Single Window mechanism for processing approvals.
- f. Incentives for early monetization.
- g.  Pricing and Marketing freedom for petroleum produced.
- h.  Liberalized terms for transfer/exit from the blocks
- i. Simplified dispute resolution framework.

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