"It can be assumed that the first production from Open Acreage License Policy (OALP) Bid Round - I may come within 5 years," said Atanu Chakraborty, Director General of Hydrocarbons (DGH), in an e-mail response to CNBC-TV18.

OALP Bid Round - I got 110 bids for 55 oil and gas blocks, where state-owned ONGC bid for 37 blocks while Cairn India put in bids for all the 55 areas on offer.

Talking on enhanced oil recovery policy, Chakraborty said, "The government has been contemplating on a broad policy framework to cover all possible ways of increasing production from the limited resources that we currently have."

He added, "The policy would guide the operators to examine any technologies that can be applied to enhance recovery from conventional as well as unconventional reservoirs and provide some result oriented incentives."

Earlier, the Ministry of Petroleum and Natural Gas floated a cabinet note for discussion on financial incentives and eligibility criteria for contractors opting for enhanced recovery (ER) methods.

Read also: Government could provide incentives to boost oil, gas recovery

Edited Excerpts:

What is the strategy for enhanced hydrocarbon production from existing oil fields, especially the ones that are old? Is there a case of giving incentives to attract companies to invest in enhanced recovery from ageing oil fields. DGH had proposed this earlier this year.

Increasing the recovery from the discovered fields being operated by all players in Indian exploration and production (E&P) space is one of the most preferred ways of enhancing domestic hydrocarbon production.

However, it has been felt at several forums that this process is not really taking off in India. In order to guide and facilitate the Indian operators, the government has been contemplating on a broad policy framework to cover all possible ways of increasing production from the limited resources that we currently have.

Inputs have been offered by DGH to the government in this matter. Further deliberations are in progress in the government. In a nutshell, the policy would guide the operators to examine any technologies that can be applied to enhance recovery from conventional as well as unconventional reservoirs and provide some result oriented incentives.

Such a policy is being a contemplated which would apply to all operators irrespective of the contractual regime or mature/new fields

What kind of investments are expected in the latest round of bids under the OALP Round - I bids and overall oil exploration sector?

The OALP Bid Round - I has just closed and the process of finalising the winners is in progress. The investment estimate could be made upon final award of the blocks.

The investment in the contractual regime has already crossed $40 billion. With the new Discovered Small Field (DSF) - II blocks and OALP Bid Round-I blocks getting operational, along with development works in the earlier blocks, massive investment is expected to be made which may be around $10 billion per year.

In addition, the national oil companies have plans to invest similar amounts in the nomination fields.

Any timeline on when the fields under OALP will see production by the company?

It would depend on the discoveries that would be made in these blocks. Depending upon that, it can be assumed that the first production from OALP Bid Round-I may come within 5 years.

By when will future rounds of OALP be taken and what will be on offer in terms of size of the fields?

OALP Bid Round - I is planned to be half-yearly exercise and the second round will happen this year end. The number and size of the blocks is dependent upon the expressions of interests (EOI) submitted by the companies.

As you may know, under OALP, a revolutionary feature is that the companies can carve their own blocks from the unlicensed area, depending upon their own assessment of the prospectivity, which are subsequently put in bidding and the originator gets a 5 point advantage.

Kindly share the estimate on expected recovery rate from the fields?

No such estimate is possible, as it is dependent on the operator’s proposals and its implementation.

Empowered panel of Secretaries have declined a proposal to grant powers to DGH in approving excess cost claims by NELP operators. What is the way forward on the issue?

No comments can be offered.

There was a proposal to sell stake in existing oil fields of ONGC and OIL. What is the status of the proposal?

DGH had provided the inputs as sought by government in this regard. The proposal is under deliberation within the stakeholders and will be implemented in the manner government deems fit.

What are the initiatives/norms/policy on shale gas by DGH?

Presently, all blocks or fields offered have a single license to explore and produce all types of hydrocarbons. In the earlier blocks awarded under erstwhile polices, we are trying to enable full realisation of the sub-surface potential, by way of policy / initiatives

First Published:May 9, 2018 4:24 PM IST