Page 5 - AsianOil Week 03

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India launches fifth exploration bid round
FINANCE & INVESTMENT
THE Indian government has offered 11 oil and gas blocks under its fifth Open Acreage Licens- ing Policy (OALP-V) licensing round.
Of the 11 blocks, which cover 19,800 square km, eight are onshore, two are in shallow waters and the last is an ultra-deepwater block. The blocks are spread across eight basins, each with a different level of prospectivity.
Bidding closes on March 18 and the govern- ment will pick the successful bids using the same criteria that were introduced in OALP-IV.
The new terms emphasise the importance of work commitments, with successful bids for underexplored Category-II and unexplored Cat- egory-III basins being determined by the size of planned exploration programmes rather than the amount of production offered to the state. Winning bids for blocks in already producing Category-I basins are also selected based upon their exploration programmes and a 50% cap on revenue sharing has been introduced.
Moreover, the new policy also introduces an alternative dispute resolution mechanism as well as a “single window” application system for online clearances.
OALP-V is offering eight Category-I blocks – six onshore, one shallow-water and one deep- water, two Category-II blocks – one onshore and one shallow-water, and one onshore Cate- gory-III block.
“It is expected that OALP-V will generate immediate exploration work commitment of around $400-450mn,” upstream regulator the Directorate General of Hydrocarbons (DGH) said on January 15.
India launched OALP in June 2017 as part of the broader Hydrocarbon Exploration and
Licensing Policy (HELP), which replaced the New Exploration Licensing Policy (NELP).
OALP allows companies to propose bound- aries of blocks they are interested in bidding for after having evaluated India’s National Data Repository (NDR). The submissions are made during a preliminary expressions of interest (EoI) stage and the government then launches a formal bidding round.
“All 11 blocks in OALP-V are based on expressions of interest received during EoI Win- dow-V from May 16, 2019 to November 30, 2019,”theDGHsaid.
Commenting on the attractiveness of HELP, the regulator said: “It comes with attractive and liberal terms like reduced royalty rates, no oil cess, marketing, and pricing freedom, round the year bidding, freedom to investors for carv- ing out blocks of their interest, a single licence to cover both conventional and unconventional hydrocarbon resources, exploration permission during the entire contract period, and an easy, transparent and swift bidding and awarding process.”
But while India’s upstream reforms were aimed at stoking the fresh foreign invest- ments, each of the government’s four pre- vious rounds have only managed to attract bids from companies already on the ground. Of the 94 blocks already awarded, Vedanta won 51, state-run Oil India Ltd (OIL) received 21 and Oil and Natural Gas Corp. (ONGC) won 17. Bharat PetroResources Ltd (BPRL), GAIL (India), Hindustan Oil Exploration Co. (HOEC) and a joint venture of Reliance Industries Ltd (RIL) and BP have also won blocks.™
SOUTHEAST ASIA
Pertamina seeks to bolster domestic crude purchases
PROJECTS & COMPANIES
INDONESIA’S state-owned Pertamina is seeking additional domestic crude supplies for its refineries in 2020 after the government trimmed the company’s import allowance for the year ahead.
The Indonesian Energy Ministry’s acting oil and gas director-general, Djoko Siswanto, told report- ers on January 14 that Pertamina had been allowed to import 50mn barrels of crude this year. Siswanto said this was about 30mn barrels less than the com- pany had requested; a deliberate move to force the company to seek local supplies.
The government’s goal has worked, with Reu- ters quoting Pertamina as saying later that day that the shortfall had driven it to open negotia- tions with domestic oil contractors.
Jakarta’s move to limit oil imports is the latest in series of such steps, each of which is designed to contain the country’s current account deficit. The government introduced a rule in 2018 requiring contractors to sell almost all of their output to the state major, exempting existing long-term export agree- ments from the requirements. The policy
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