Lok Sabha Question No. 306 (STARRED), answered on 2022-03-24
Subject: Hydrocarbon Exploration Licensing Policy
Ministry: PETROLEUM AND NATURAL GAS
Asked by: Anil Firojiya

## LOK SABHA STARRED QUESTION NO. *306 TO BE ANSWERED ON 24 th  MARCH 2022

## Hydrocarbon Exploration Licensing Policy

## *306. SHRI ANIL FIROJIYA:

## पेोलयम और ाक ृ तक गैस मंी

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

(a)  whether there has been any change in the auction methods of blocks discovered after the implementation of flexible Hydrocarbon Exploration Licensing Policy in the country; (b)  if so, the details thereof; (c)  whether any scheme has been formulated to strengthen the developing energy sector in the country; and

- (d)  if so, the details there of ?

## ANSWER

## पेोलयम और ाक ृ तक गैस मंालय म मंी ( ी हरदप संह पुर )

## MINISTER IN THE MINISTRY OF PETROLEUM & NATURAL GAS (SHRI HARDEEP SINGH PURI)

(a) to (d)  A statement is laid on the table of the house.

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## STATEMENT  REFERRED  TO  IN  REPLY  TO  PARTS  (a)  to  (d)  OF  THE  LOK SABHA  STARRED  QUESTION  NO.  306  BY  SHRI  ANIL  FIROJIYA  TO  BE ANSWERED  ON  24.03.2022  REGARDING  HYDROCARBON  EXPLORATION LICENSING POLICY.

- (a) & (b): Government notified a transformative policy namely Hydrocarbon Exploration  and  Licensing  Policy  (HELP)  on  30 th March,  2016  to  increase investment in domestic exploration and production sector. The major thrust of the policy  was  ease  of  doing  business  with  minimal  Government  intervention. Deepening  the  reforms  further,  Government  on  28 th February,  2019  notified further reforms in HELP, inter alia, bringing changes in auction methodology. With the  introduction  of  these  reforms,  Government  moved  from  'Maximisation  of Revenue  to  Government'  to  'Maximisation  of  Production'.  The  major  changes, inter alia, include:
- i. Indian  Sedimentary  basins  were  classified  into  three  categories,  namely Category-I, II and III, based on hydrocarbon prospectivity and commerciality. In Category-II and Category-III basins, where prospectivity is low, the areas are to be awarded exclusively based on Work Program which bidder commits to undertake without any Revenue Share to Government. Revenue is to be shared with Government in case of windfall gain i.e. when revenue exceeds USD 2.5 billion in a financial year.
- ii. In Category-I basins,  where  commercial reserves are established, for awarding the blocks, emphasis was shifted to  Work Programme  by enhancing its weightage to 70%. Remaining 30% weightage was allocated to Revenue to the Government. This was 50% each earlier. Further, to prevent speculative  bidding,  upper  ceiling  of  50%  was  also  imposed  on  Revenue Share to Government.
- iii. To provide more opportunities to bidders, Expression of Interest submission cycle was increased from twice to thrice in a year.
- (c)  &  (d):    In  addition  to  reforms  under  HELP,  several  other  policy  initiatives  to strengthen  the  energy  sector  in  the  country  have  been  taken  which,  inter  alia, include:
- I. A National Data Repository (NDR) was established in 2017 where entire E&P Data of the country is available for potential bidders to help carve out blocks of interest.
- II. Appraisal of un-appraised areas in sedimentary basins under National Seismic  Programme,  2017  to  enhance  availability  of  E&P  Data  to  potential bidders.
- III. Discovered  Small  Field  (DSF)  Policy,  2015:  This  allowed  starting/restarting production  from  unmonetised discoveries  of ONGC/OIL, which could  not be put on production due to various reasons.
- IV. Gas reforms to incentivise production of gas.
- V. In addition, a large number of reforms were undertaken to resolve the pending issues  in  the  existing  Contracts,  streamlining  processes  for  ease  of  doing business etc. A list of Reforms is attached at Annexure .

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## ANNEXURE REFERRED TO IN  REPLY OF  PARTS  (c)  AND  (d)  OF  THE  LOK SABHA  STARRED  QUESTION  NO.  306  BY  SHRI  ANIL  FIROJIYA  TO  BE ANSWERED  ON  24.03.2022  REGARDING  HYDROCARBON  EXPLORATION LICENSING POLICY.

## Policy initiatives undertaken by Government to boost exploration and production activities in the country.

- i. Policy for Relaxations, Extensions and Clarifications under Production Sharing Contract (PSC)  regime for early monetization of hydrocarbon discoveries, 2014.
- ii. Policy for Extension of Production Sharing Contracts, 2016 and 2017.
- iii. Policy for early monetization of Coal Bed Methane 2017
- iv. Appraisal of Un-appraised areas in Sedimentary Basins under National Seismic Programme, 2017
- v. Re-assessment of Hydrocarbon Resources 2017
- vi. Policy  framework to streamline the  working  of Production Sharing Contracts (PSC) in Pre- NELP and NELP Blocks, 2018.
- vii. Policy  to  Promote  and  Incentivize  Enhanced  Recovery  Methods  for  Oil  and Gas, 2018.
- viii. Policy framework for Exploration and exploitation of Coal Bed Methane (CBM) from areas under Coal Mining Lease allotted to Coal India   Limited (CIL) and its subsidiaries 2018.
- ix. Policy Framework for Exploration and Exploitation of Unconventional Hydrocarbons under Existing Production Sharing Contracts (PSCs) Coal Bed Methane (CBM) Contracts and Nomination Fields, 2018.
- x. Natural Gas Marketing Reforms 2014 - 2021 to inter alia provide mechanism for discovery of market price of natural gas.
- xi. Policy  for  extension  of  Production  Sharing  Contracts,  2016  and  2017Ensuring continuation of production from already operating fields, whose PSC terms were ending.
- xii. Policy  in  Oct'2018  to  promote  and  incentivize  Enhanced Recovery  Methods for oil and gas, to enhance production from matured fields.
- xiii. Policy reforms in February, 2019 to increase exploration activities, attracting domestic and foreign investment in unexplored/unallocated areas.

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