Govt to auction 27 oil fields off Mumbai, 15 off KG basin
14 Sept 2015 5:31 AM IST
More than a third of the 69 small and marginal oil and gas fields that the government plans to auction to private firms are in Mumbai Offshore and the biggest of them holds about 15 million tons of oil reserves.
Of the 69 idle oil and gas fields of state-owned ONGC and Oil India Ltd which are to be auctioned, 27 are in Mumbai Offshore while another 15 are in the prolific <g data-gr-id="129">Krishna Godavari</g> (KG) basin, official
sources said. As many as 10 discoveries in the Assam Shelf are also on offer.
The discoveries, which the government says were given up by the two oil companies as they were unable to develop them for varied reasons, include ones made as late as 2012-13.
In all, seven marginal discoveries of ONGC date back to less than five years, with 2012-13 <g data-gr-id="132">Koravaka</g> gas field in KG basin being the youngest. An equal number of finds were made between 2005-06 and 2008-09. While cumulatively the surrendered small and marginal fields hold about 50.8 million tons of oil and 53.45 billion cubic meters of gas, the biggest discovery is the D-18 in Mumbai Offshore that along holds 14.78 million tons of <g data-gr-id="133">inplace</g> oil reserves.
Among the gas discoveries, the largest is ONGC's B-9 find in the offshore Kutch basin that has an <g data-gr-id="130">inplace</g> reserve of 14.67 <g data-gr-id="131">bcm</g>. Sources said while Oil and Natural Gas Corp (ONGC) has surrendered 63 discoveries, OIL has given up six all of whom are in Assam Shelf.
The 69 fields will be grouped with those lying adjacent clubbed to form on <g data-gr-id="158">unit</g>. So far the clubbing has brought down the number of fields to be offered in the auction to 48, they said adding the final number of offer may be a little lower. The auction will be done on a new revenue sharing model where bidders will be asked to quote the revenue they will share with the government at low and high end of price and production band.
This would help the government capture windfall of <g data-gr-id="166">steep</g> rise in prices as well as <g data-gr-id="167">quantum</g> jump in production. The new revenue sharing regime will replace the controversial Production Sharing Contract (PSC) model where oil and gas blocks are awarded to those firms which show they will do maximum work on a block. The PSC regime allowed all their investments to be recovered from <g data-gr-id="162">sale</g> of oil and gas before profits are shared with the government. This model was criticised by CAG which said it encouraged companies to keep raising cost so as to postpone higher share of profits to the government. For the small and marginal fields, the government is also offering pricing and marketing freedom as well as a unified licence that will give operators right to produce both conventional oil and gas as well as unconventional resources like shale oil and gas and coal-bed methane (CBM).
Operators will get a <g data-gr-id="149">20 year</g> licence and they will be allowed to carry out exploration throughout the life of the licence. This is in contrast to the PSC regime where exploration is not allowed in an area where discovery is made.
WCL’s <g data-gr-id="176">Junad</g> open cast mine gets green nod to raise coal output
State-owned Western Coalfield Ltd (WCL) has got the environment clearance for raising <g data-gr-id="373">production</g> capacity of its <g data-gr-id="178">Junad</g> Deep Open Cast mine in Maharashtra to 1.5 million tonne per annum (<g data-gr-id="179">mtpa</g>) from existing 0.60 <g data-gr-id="180">mtpa</g>. The expansion of the mine, located in Yavatmal <g data-gr-id="189">district,</g> would entail an investment of Rs 58 crore and would ensure regular coal supplies to <g data-gr-id="188">thermal</g> power plant of Mahagenco. WCL is the one of the eight subsidiaries of Coal India. "The Ministry of Environment and Forest hereby accords environment clearance (EC) to <g data-gr-id="181">Junad</g> Deep open cast (OC) mine project for capacity enhancement from 0.60 <g data-gr-id="182">mtpa</g> to 1.5 <g data-gr-id="183">mtpa</g>," according to the EC letter granted to the Western Coalfields. The Ministry has also given <g data-gr-id="186">green</g> nod for increasing the land area of the mine from 174.28 <g data-gr-id="184">hectare</g> to 449.63 <g data-gr-id="185">hectare</g> subject to certain conditions, the letter said.
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