Page 5 - AsianOil Week 20

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CIL subsidiary Bharat Coking Coal Ltd (BCCL) said it was looking for a contractor to explore and develop the Jharia CBM Block-I in the eastern state of Jharkhand and the market the production. The block, which is expected to require INR18.79bn ($248.2mn) worth of investment, holds an estimated 25bn cubic metres of CBM reserves. First production is slated for two years from start of development.
Sister company Eastern Coalfields Ltd (ECL) has offered the Raniganj CBM block in the neighbouring state of West Bengal for exploration, with the project estimated to need INR5.95bn ($78.6mn) worth of investment. The block is estimated to hold 3 bcm of CBM.
Each project will be developed over three phases – exploration, pilot assessment and mar- ket survey, then development and production.
CIL has appointed its wholly owned Central Mine Planning & Design Institute (CMPDI) as principal implementing agency (PIA) to both projects to help speed them up.
“As part of the bidding documents, the PIA on behalf of the lessee has provided a reve- nue-sharing contract (RSC) agreement, which sets forth the detailed terms and conditions of
the project, including the development of the CBM project, operation and maintenance of the CBM project, extraction, delivery and marketing of CBM extracted and rights and obligations of the [developer],” the company said.
Local financial daily the Economic Times quoted an unnamed CIL executive on May 14 as saying that Adani, Essar and RIL had partic- ipated in a pre-bid for the CBM projects. The executive said the company planned to invite bids in the coming week and that CIL was reviewing them.
“One more CBM block at South Eastern Coalfields Ltd (SECL) is likely to be tendered. Additional CBM blocks are under delineation at Central Coalfields and in Bharat Coking Coal’s leasehold areas,” the paper quoted an unnamed spokesperson as saying.
CIL is under pressure to expand its busi- ness interests following Indian Finance Min- ister Nirmala Sitharaman’s announcement on May 16 that the government intended to break its monopoly over the coal-mining sec- tor. She revealed that the private sector would be able to bid for nearly 50 blocks under a rev- enue-sharing mechanism.™
CIL is under pressure to expand its business interests now that the government intends to break its monopoly over the coal-mining sector
ONGC awards 13 marginal field development contracts
PROJECTS & COMPANIES
STATE-RUN Oil and Natural Gas Corp. (ONGC) has awarded production enhancement contracts (PECs) covering 49 marginal onshore fields to seven bidders. The fields are split into 13 licences. ONGC had invited bids for PECs covering 64 onshore fields, split into 17 contract areas, in June 2019.
While the winners must boost production beyond a pre-agreed upon baseline volume, they will enjoy complete freedom when it comes to selling the output.
Indian financial daily Business Standard said bidders had included Duganta Oil and Gas, Oil- max, Deep Industries, Dravida Petroleum, Hermes Tech, Shivam Crusher, LNG Bharat, Udayan Oil Solutions, Preserve Infrastructure, Syndicate, M&S Co., Advent Oilfields and Orissa Stevedores.
Local newswire PTI quoted unnamed sources in January as saying that the round had attracted 28 bids for 50 fields in 14 contract areas. Duganta Oil and Gas was understood to have bid on four areas, while Orissa Stevedores, Priserve Infrastructure and Udayan Oil Solutions had each bid on three areas.
Under the terms of the PECs, contractors will earn a share of the oil and gas produced above a pre-agreed baseline and will enjoy a 10% dis- count on royalties.
ONGC launched the bid round as part of a drive to improve its oil production, which shrank to a 17-year low of 414,000 barrels per day in financial year 2019-2020, down 2% on the previous 12-month period’s 422,500 bpd. At a national level, crude output fell for a ninth consecutive year to 644,000 bpd, down 6% from 689,000 bpd in 2018-2019.
ONGC’s upstream prospects for the year ahead appear somewhat gloomy, given reports that the company is preparing to review its budgets should the government not provide some sort of tax relief to reflect the low oil price environment.
The company has complained about pric- ing restrictions on local gas production and is reportedly expected to rack up a INR60bn ($792.4mn) loss from its gas business in 2020- 2021, from a projected INR45bn ($594.3mn) loss in 2019-2020.™
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