Oil firms can identify what theyll bid for

The committee has recommended a system of open access to avoid post-bid problems in allocation of blocks for exploration and production of oil and gas

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The committee has recommended a system of open access to avoid post-bid problems in allocation of blocks for exploration and production of oil and gas.

Under the current system called New Exploration Licensing Policy (NELP),the government identifies blocks for bidding. The committee suggests the government allow firms to bid for blocks after examining data available through an open access system called the Open Acreage Licensing Policy. In other words,the block would be selected by the market and not the government.

The committee has recommended a National Data Repository where all firms owning E&P blocks will share exploration data on a publicly accessible server. It says that the process of setting up the NDR has been tardy.

By allowing firms to identify and then bid for blocks instead of using the current auction system,the committee wants to encourage more mid-size firms to enter a space dominated by big players.

It has found that though the production-sharing contract mandates continued investment,this has not been happening. To counter this,it suggests the DGH be reconstituted as an independent technical attached office of the Petroleum Ministry and ensure investment audit.

The report also suggests an upstream regulatory body or entrusting the work to the Petroleum and Natural Gas Regulatory Board. The upstream regulator should ideally have no staff on deputation from any of the companies under its regulation as is the current practice.