The Indian economy is a net importer of almost all forms of energy.
This fact, coupled with the growing energy needs, has intensified discussions on
energy security for the country. The government is actively seeking private participation
in the energy chain and is also promoting acquisition of oil & gas reserves overseas.
Back home, the rapidly growing Indian economy requires huge investment in the energy
sector. Strong private sector participation is required to suplement public sector
and bring in the required investment and technologies. Policies have increasingly
recognized the need to promote private investment. Private interest in oil & gas
exploration and power sector has increased significantly Government is making efforts
to diversify the fuel basket by increasing share of Natural Gas, Hydro and Nuclear
energy. At the same time, both the Government and private sector companies are looking
to acquire equity in energy assets abroad.
To increase upstream investments, the Ministry of Petroleum & Natural Gas formulated
New Exploration licensing Policy (NELP) in 1999 providing level playing field for
all the investors and providing several concessions and incentives to attract investment
and technology. Under the policy blocks for exploration are awarded through global
competitive bidding process which is most transparent. So far seven bidding rounds
have been held resulting in award of 203 blocks.
Eighth round of bidding is currently in process which has been launched recently
along with fourth round for Coal Bed Methane blocks. Government of India is offering
the highest ever number of 70 oil & gas exploration blocks covering an area of about
1,63,535 Sq. Km. and also making a simultaneous offer of 10 blocks under the fourth
round of Coal Bed Methane Policy (CBM-IV) for exploration and production of Coal
Bed Methane. The blocks offered under CBM-IV cover an area of about 5000 Sq.Km.
and are spread over seven States.
The NELP-VIII licensing round has been put on offer against a backdrop of continued
exploration success. Under NELP, 71 oil and gas discoveries have already been made
in 19 exploration blocks. Hydrocarbon accretion has already been more than 600 Million
Metric Tonnes of oil & oil equivalent of gas. First deepwater crude oil and natural
gas production has commenced from NELP-I block KG-DWN-98/3(D-6). With this, the
gas production from the eastern part of the country would double the present production
of gas and in monetary terms, it would be worth about US$ 42 billion.
