Bid round - II under Discovered Small Field Policy to be launched today
Published: Aug 09, 2018
By TIOLCORPLAWS News Service
NEW DELHI, AUG 09, 2018: BID round –II under Discovered Small Field Policy will be launched today. The event will be presided over by Mr Dharmendra Pradhan, Minister of Petroleum and Natural Gas & Skill Development and Entrepreneurship.
India is the world's fifth-largest economy with the size of over 2.6 Trillion USD. Recently, it surpassed France and soon India is set to leapfrog Britain to become the fourth-largest economy.
India is the 3rd largest energy consumer in the world. Its energy consumption is expected to grow by 4.2% p.a. which is faster than all major economies. According to the International Energy Agency (IEA), India is expected to account for almost one-third of the global growth in energy demand by 2040.
To maintain the thrust on economic growth, it is imperative that the country's Oil & Gas sector grows consistently so as to enable energy security and accessibility to its people.
Policy reforms in this sector:
In addition to several other reforms, Government has implemented new contracting policies such as the Open Acreage Licensing Policy (OALP), and the Discovered Small Fields (DSF) policy. These are primarily based on the four energy pillars as laid by Hon'ble Prime Minister Mr Narendra Modi viz. Energy Access, Energy Efficiency, Energy Sustainability and Energy Security.
About Discovered Small Fields Policy:
Ministry of Petroleum and Natural Gas India launched the DSF in 2016, with the motive for extracting the Oil, Natural gas from the un-monetized small oil/gas discoveries that are available in the country. It provides an easy investment option for new and existing players with minimal risk.
Directorate General of Hydrocarbon (DGH), under the Ministry of Petroleum and Natural Gas, looks after the DSF policy implementation and is taking extensive outreach effort on behalf of Government to attract new players to the industry.
DSF Bid Round-I launched by the Government, was a splendid success and was completed in a record time of 10 months. It received overwhelming success with 134 bidders for 34 blocks on offer. 30 contracts were awarded to 20 companies out of which 13 were new entrants in E&P sector. First oil/gas is expected in 2019-20.
Encouraged with the Success of Bid Round-I, and looking at the massive interest from Industry, especially from Private Sector; the Government is now to rolling out DSF Bid Round-II which is offering larger field areas in commercially producing basins .
Features of DSF Bid Round–II are as below:
No previous technical experience required for bidders, easy entry & investor friendly policy
Expected to offer around 60* discoveries clubbed into around 26* new contract areas
Large field areas on offer in already producing basins
Established Hydrocarbon resource base of over 190 MMT (O+OEG)
Better fiscal system through Revenue Sharing Contracts
Area having oil/gas discoveries; Potential of upsides in the area; Ready processing facilities nearby; Ready market
Easy bidding process; minimum requirements; transparent award; swift processing of approvals
Single licence for all types of hydrocarbons
No signature bonus
Exploration allowed during the entire contract period
Full pricing and marketing freedom
Royalty rates further reduced for shallow water compared to DSF-I
