Government receives 181 bids for 45 hydrocarbon blocks

Government receives 181 bids for 45 hydrocarbon blocks

Monday, 30 June 2008, 07:00 Hrs
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New Delhi: The seventh round of auction of India's hydrocarbon assets Monday received 181 bids from 96 companies for exploration in 45 blocks, the government announced.

Indian petroleum officials termed this round as the “most successful round ever”, there being every indication that investments would top $3 billion. This was also the highest number of bids received in block auctions so far.

The sixth round in 2006 received 165 bids for the 52 blocks put on auction.

Of the 57 blocks on offer this time, 26 received multiple bids and 19 received single bids. Twelve blocks did not receive any bid.

Interestingly, two blocks in the Cambay basin have attracted 17 bidders each. They are both S-type category, in which previous experience the oil and gas exploration was not an essential criterion.

The 12 blocks that did not receive any bid were “recycled blocks” which had no takers in the previous rounds.

"Since seven of these were deepwater blocks, it is possible that the worldwide shortage in equipment, especially of rigs, could be a reason for there being no bids," said a petroleum ministry official.

Nevertheless, 12 deepwater blocks attracted bids.

And, additionally, 27 other “recycled” blocks did get bids from companies.

Bidders included BHP Billiton, BP Plc (formerly British Petroleum), Cairn Energy, Oil and Natural Gas Corp (ONGC), Reliance Industries, Essar Oil and GVK Industries. There were 21 foreign companies, including nine first-time bidders.

Among the companies which have made single bids are the consortium of BHP and GVK, which bid for six blocks. ONGC has reportedly won eight of those single bids, including some in consortium with GSPC and Tata Petrodyne.

Essar Oil and Cairn Energy have also got one block each.

No decision has been taken on multiple bids. Evaluation has to be completed within two months, and contracts signed by September 30.

A senior petroleum ministry official said it was difficult to give a “final figure” on investment at this stage, but he expected it to go past the target of $3 billion.

"We expect $4.5 billion in final investment for the 52 blocks auctioned in the sixth round. Due to higher costs and slightly lower number of blocks for auction this time, we certainly expect investment to be over $3 billion," said S. Sundareshan, additional secretary in the petroleum and natural gas ministry.

Earlier, the deadline for the closing of the bids had been postponed thrice after the finance ministry withdrew tax holiday on gas exploration, throwing potential bidders into confusion.

But, officials played down the issue, Monday, saying clarification had been made on the issue last Friday.
Source: IANS
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