India on January 18, 2018, has launched the 1st auction of exploration blocks under its new licensing policy and sought bids for 55 blocks spread across the country.
This is the 1st auction in 8 years of exploration blocks in the country, which has tweaked its licensing policy several times in the past without brilliantly raising its crude oil and gas output. It imports 82% of its oil requirement today and aims to bring that down to 67% by 2022.
The new licensing policy aims to raise local output by replacing many previous rules that only incrementally boosted output but caused several legal disputes between the government and the industry.
«We are not a glorious geology and despite that bidders have submitted Expression of Interest (EOI) for 59,000 sqkm,» Oil Minister Dharmendra Pradhan said after launching the auction. He was referring to the country's not-so-attractive hydrocarbon reserves.
The new policy offers single license for all forms of hydrocarbons in a block, gives companies the freedom to market and price oil and gas, and operates with a revenue-sharing model, which potentially reduces scope of bureaucratic micro-management of oil contracts.
All bids will be evaluated, and winners announced by May.