ONGC, Reliance asked to surrender 10 E&P blocks
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ONGC, Reliance asked to surrender 10 E&P blocks

By agencies   |   Thursday, 29 June 2006, 07:00 Hrs
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MUMBAI: India's largest public sector undertaking (PSU) Oil and Natural Gas Corporation (ONGC) and the largest private sector enterprise Reliance Industries Limited (RIL) have been asked by the central government to surrender 10 exploratory blocks across the country for failing to make promised investments in these blocks within stipulated time lines. Confirming the development, a petroleum ministry official remarked that these blocks were offered under the last five rounds of NELP.

The two companies have been asked to return the blocks on the recommendation of the directorate general of hydrocarbons (DGH). VK Sibal, director general who could not be reached for his comments. Three of RIL's blocks under government scrutiny lie in the hydrocarbon rich Krishna-Godavari basin, where RIL had discovered India's largest gas reserves. The other is in the Gulf of Kutch. However, a source close to RIL said, "These blocks were dry and do not have the potential for commercial production of hydrocarbons."

The blocks taken away from ONGC and RIL are expected to be re-tendered in the seventh round of NELP next year and both the companies would have to pay a penalty for the default. ONGC's official spokesperson declined to comment on the issue. The government has so far awarded 110 exploration blocks in five rounds of NELP bidding.

According to a DGH official, in the last five rounds of NELP, ONGC had been offered 47 blocks and RIL 32 and ONGC had committed drilling 78 wells as compared to 47 wells committed by RIL.

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