Policy
framework for relaxations, extensions and clarifications at the
development and production stage under psc regime for early monetization
of hydrocarbon discoveries
The
Cabinet Committee of Economic Affairs, chaired by the Prime Minister Shri
Narendra Modi, today approved the proposal of Ministry of Petroleum and Natural
Gas regarding “Policy Framework for Relaxations, Extensions and clarifications
at the Development and Production stage under PSC regime for early Monetization
of hydrocarbon discoveries”. There is a reform initiatives which would help in
monetization of some of the pending discoveries, lead to resolution of various
long pending operational issues which are hampering E&P operations and
create better climate for investment. The salient features of this Reform
Measure are as follows:-
(i)
Extension of Appraisal period for submission of
Declaration of Commerciality (DOC) in respect of Hydrocarbon discovery.
(ii)
Extension of time period for submission of Field
Development Plan (FDP) after review of DOC by the Management Committee.
(iii)
Reduction in Minimum Work Program (MWP) in case
a block or its part is not available for exploration activities consequent to
denial of permission by Government Agencies.
(iv)
Swapping of 2D and 3D Seismic Minimum Work
Programme, on the request of the operator.
(v)
In cases where the committed Minimum Work
Programme of any particular exploration phase is not completed, entry into
subsequent exploration phases, would be permitted after paying cost of
unfinished MWP of previous phases.
(vi)
Condoning delays in submission of notice for
entering into next phase.
(vii)
Condoning delays in submission of Annual Work
Programme and Budget and the Appraisal work programme.
(viii)
Permission for drilling of Appraisal Wells after
submission of DOC.
(ix)
Probing additional reservoirs during appraisal
programme.
(x)
Acceptance of discoveries for which notification
to the Government has not been made are also notification for testing has not
been provided as prescribed.
These
changes do not change the basic structure of the PSC and have been approved in
the overall interest of the energy security of the country.
These
proposals are expected to yield the following benefits:
·
Monetization of some of the discoveries which
are struck because of expiry of timelines. Some examples are enclosed.
·
Additional discoveries in the appraisal period.
·
Improvement in investment climate because of
resolution of disputes between the contractors and the Government.
·
Enhancement of production of oil and gas from
these blocks.
·
Preparation of a more robust FDP.
Examples of Discoveries which would be
Monetized because of these Relaxations
1.
CB-ON-2 (GSPC); Tarapur-6; GSPC ; (Oil
discovery); OIIP – 11.205 (in MMBBL).
2.
AA-ONN-2001/1 Khubal-4; ONGC; (Gas discovery);
GIIP-35;(in BCM)
3.
KG-ONN-2003/1; Nagalanka-1Z; Cain India Limited;
(Oil discoveries); OIIP – 41.21 (in MMBBL). Gas – 5.93 BCF
4.
KG-ONN-2003/1 Nagalanka-SE-1Z; Cairn India
Limited; OIIP-195.09; (in MMBBL)
5.
CB-ONN-2000/1:SE-1:GSPC (Oil discovery);
OIIP-2.11; (in MMBBL)
*****
AK/SH/SK
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