Draft Fiscal and Contractual Regime for Award of Hydrocarbon Acreages released
The purpose of the new policy is to reform the existing exploration and production management and subsequently, improve ease of doing business in the country.
Union Ministry of Petroleum and Natural Gas on 16 November 2015 released a consultation paper on renewed fiscal and contractual regime for award of hydrocarbon acreages for comments from public.
The purpose of the new policy is to reform the existing exploration and production management and subsequently, improve ease of doing business. It is in tune with the Policy for Marginal Fields as approved by the Union Cabinet in September 2015.
Key features of proposed policy
Uniform Licensing Policy (ULP): Instead of separate licenses for petroleum, natural gas, etc a ULP will be issued to enable the contractor to explore conventional and unconventional oil and gas resources including coal bed methane, shale gas, tight gas, gas hydrates under a single license.
Open Acreage Licensing Policy (OALP): It will allow companies to submit bids for areas of their choice within the demarcated 3.14 million square kilometres, which will be then validated by the Director General of Hydrocarbon (DGH) with its own geological and geophysical data.
Revenue Sharing Contract (RSC): Instead of the existing production-sharing contract, the draft suggested for revenue-sharing model allowing for transparent and market-oriented mechanism.
Pricing & Marketing Freedom: As against the government determined price mechanism, contractors will be provided pricing and marketing freedom to incentivize production.
Now get latest Current Affairs on mobile, Download # 1 Current Affairs App